Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
Insurance
| Question | Answer |
|---|---|
| What is a material misrepresentation? | A statement that upon discovery would affect the underwriting decision of the insurance company. |
| When does acceptance occur? | When an insurer's underwriter approves coverage. |
| The insurer must be able to rely on statements in the application and the insured must be able to rely on insurance to pay a claim. | Utmost good faith |
| A participating insurance company will | pay dividends to the owner |
| Fiduciary responsibility | The trust a client places in a producer in regards to handling premiums. |
| A person can only lose or have no change | Pure risk |
| Not a goal of risk retention | To minimize an insured's level of liability in the event of a loss |
| Apparent authority | Perceived authority |
| An insured makes truthful statements on the application for insurance and pays the required premium | Consideration |
| How must a replacing producer respond to an applicant wishing to replace existing life insurance? | Provide the applicant with a Notice regarding replacement. |
| Gross Annual Premium | Net premium plus expenses |
| Creditors have rights to insurance | If premiums were used to defraud or if the insured filed bankruptcy |
| During replacement life insurance | A list of all insurance policies to be replaced must be obtained |
| Received a conditional receipt than dies | Insurance will only pay if it would have issued the policy |
| Substandard risk is also called | Rated |
| How many days to rescind a viatical contract? | 15 days |
| Viatical settlements do not request | A birth certificate |
| An application for a viatical insurance license must be submitted to | The insurance department |
| Underwriting process | Selection, Classification, and Rating of Risks |
| Avocation | Hobbies |
| The type of policy that can be changed from one that does not accumulate cash value to one that does | Convertible Term Policy |
| In a single employer group plan, what is the name of the policy issued to the employer | Master Contract |
| Who does not regulate variable life policies? | The Guaranty Association |
| Term policies are not | renewable |
| SEC registration is NOT needed to sell | Variable insurance |
| Annually renewable insurance is | level term insurance. |
| Not true of variable universal life policy | the death benefit is fixed |
| Universal Life, Option A | Gradually increasing cash value and level death benefit |
| An employee is joining group insurance, in order to avoid proof on insurability they must join during | the open enrollment period |
| Variable whole life insurance has | a level fixed premium |
| How many days can a client return a policy for a full refund? | 10 days |
| Entire contract | Application, Policy, Riders or Amendments |
| Grace period | 30 or 31 days (1 month) |
| Reinstatement for how long | Up to three years |
| Incontestability Period | Two years |
| Status clause exclude military while | on active duty |
| Double indemnity | Twice the face amount |
| What happens to a policy's cash value under an extended term nonforfeiture option? | The cash value is converted to the same face value amount as in the whole life policy. |
| Most common exclusions | War and military service, hazardous occupations, and aviation |
| Absolute Assignment | Transfer of all ownership rights to a third pary |
| Other insured rider | provides coverage on family members |
| What nonforfeiture option provides coverage for the longest period of time? | Reduce paid-up |
| Incontestibility | Disputing or denying a claim due to misstatements over a period of time |
| Three nonforfeiture options | Cash surrender, reduced paid-up, extended term |
| What dividend options can increase the death benefit of the existing life policy? | Paid-up additions |
| Who does the common disaster clause protect? | The contingent beneficiary |
| What are the dividend options? | Cash, reduced premiums, accumulation of interest, paid-up additions, paid-up option, one-year term |
| Settlement options | methods of payment |
| Reinstatement | reactivate a lapsed policy |
| What nonforfeiture option is automatically picked? | Extended term |
| Policy waiver is disabled | Waiver of premium |
| Grace period | Extends coverage beyond premium due date |
| Beneficiary that can be changed | Revocable |
| What are policy dividends? | Return of unused premiums |
| Nonforfeiture option that the company pays surrender value with no further obligations | Cash surrender |
| Settlement options | Lump sum, fixed period, fixed amount, life income, interest only |
| Settlement option not chosen then | lump sum will be paid. |
| What type of assignment is used to secure the payment of a debt with an existing life insurance policy? | Collateral assignment |
| Viatical Settlement Purchaser | Someone who gives money as consideration for a life insurance policy |
| Viatical Settlement broker represent | Viators |
| Legal document that dictates who can buy a deceased partner's share of a business and for what amount | Buy-sell agreement |
| Duty of viatical settlement broker | To negotiate contracts between viatical settlement providers and viators on behalf of viators |
| Underwriter needs further medical information, who do they get it from | Attending Physician Statement |
| Who will provide an underwriter with information concerning an applicant's health history | MIB - Medical Insurance Board |
| An underwriter may obtain information on an applicant's character, financial status, and habits from | An investigative consumer report |
| In increasing and decreasing term policies which component fluctuates during the term | Death benefit |
| What type of insurance can be used for key person coverage? | Any type of insurance |
| Illegally issuing viatical settlements contracts | Fraudulent Viatical Settlement Act |
| Who regulates variable insurance? | State and federal government, the insurance department, and the SEC |
| At the time of initial licensing, what fee must a viatical settlement provider pay? | $300 |
| How long must insurers maintain the evidence from the agent that a disclosure statement about a life insurance policy was delivered to the applicant? | 3 years |
| Insurers must notify Commissioners' office as to whether or not a life insurance policy will be marketed with illustrations. Certification of that notification must be provided annually within how many days of the anniversary of the original certificate? | 30 days |
| Basic source of information used by the insurance company in the risk selection process? | Application |
| Two components of a universal life policy | Insurance and cash amount |
| SEC registration is for whom? | Securities, not agents. |
| Which policy has an IRS required corridor or gap between the cash value and death benefit? | Universal Life - Option A |
| Which life insurance policy would be considered interest sensitive? | Universal Life |
| If a viatical settlement provider transfers ownership of an insurance policy, how long does the insurer have to inform the insured of the change? | 20 days |
| Who makes up the Medical Insurance Bureau? | Insurers |
| Face value | death benefit |
| Cash value | savings and investment component |
| What helps a universal life policy from lapsing? | Target premium |
| What cannot be changed in an adjustable life policy? | The type of investment |
| An accidental death rider | pays double or triple the face amount |
| Extended term nonforfeiture option , the cash value will be used to purchase term insurance with what face amount? | Equal to the original policy for as long as the cash value will purchase. |
| How long is a insurance policy allowed to defer a policy loan request? | 6 months |
| face amount is also called | death benefit |
| An annuity purchased with multiple payments that began income payments after one year from the moment of purchase is known as what type of annuity? | Flexible premium deferred annuity |
| What annuity settlement option provides income payments to the annuitant for the duration of her life, and ceases at the annuitant's death? | Pure Life |
| What are two phases of an annuity? | Accumulation and annuitization |
| What annuity settlement option provides income payments to the annuitant for the duration of her life, and also guarantees payment for a specified number of years? | Life income with period certain. |
| If the annuitant dies before the annuitization period begins, what will the beneficiary receive? | Either the amount paid into the annuity or the cash value, whatever is greater. |
| What are the two types of refund life annuities? | Cash refund or installment refund |
| What type of annuity is suitable for someone who wants to select the benefit option that will pay the largest amount only for as long as the annuitant lives? | Straight life |
| With a single premium deferred annuity, when will the annuity payments become available? | No sooner than one year after the annuity is purchased. |
| Indeminity | the insured can only collect for the amount of the loss even if the policy is written with greater limits |
| Survivorship policy pays on the | last death |
| The death benefit in a variable universal life policy is | fixed |
| What type of life insurance is most commonly used for group plans? | Annually renewable term |
| A married couple owns a permanent policy which covers both their lives and pays the death benefit only upon the death of the first insured | Joint life policy |
| If the policy has irrevocable beneficiary designation the beneficiary can only be changed with | written permission of the beneficiary. |
| Straight Life | Life income |
| Nonforfeiture options are required to be in the | Policy |
| Reduced paid up | Stop paying premium but keep lower coverage |
| Extended term | Keeps original death benefit but only for a limited period of time. |
| Payor benefit waiver | Must be disabled for more than six months |
| What is the term for the entity that an agent represents regarding contractual agreements with third parties? | Principal |
| If an individual wants both protection and savings from their insurance, and are willing to pay premiums until retirement at age 65 , what would be the right policy for this individual? | Limited pay whole life. |
| What protects the insured from unintentional policy lapse due to a nonpayment of premium? | Automatic premium loan |
| When the life insurance policy stipulates the beneficiary will receive payments in specified installments or for a specified number of years, what provision prevents the beneficiary from changing or borrowing from the planned installments? | Spendthrift Provision |
| The policy owner wants to make sure upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but the principal will be paid to their children when they reach a certain age. What settlement option should he choose? | Interest only |
| If a settlement option is not chosen on a policy, who chooses it? | The beneficiary |
| What is the benefit of choosing extended term as a nonforfeiture option? | It has the highest amount of insurance protection. |
| What happens if a deferred annuity is surrendered before the annuitization period? | The owner will receive the surrender value of the annuity. |
| What is a feature of a variable annuity? | Benefit payment amounts are not guaranteed. |
| Which is a short term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated? | Annuity certain |
| What is the accumulation period of an annuity? | It is the period when the payments grow tax differed. |
| Annuity accumulation period is also know as | the pay in period. |
| What are the two types of refund life annuities? | Cash refund and installment refund |
| What type of annuity credits its interest based upon an index? | Equity indexed annuity |
Created by:
mishaellen