Chapter 15: Texas Rules for Life Only Flashcards
_____ are responsible for the form and content of all advertisements.
Insurers
TF; Advertising = Dividends NOT Guaranteed
True
Life insurance advertisements may not make an unfair or incomplete _____ of policies, benefits, dividends, or rates. If an advertisement contains a _______ (Same) of policies from different insurers, the advertisement must prominently state:
“The description of the other insurance company’s policy was not furnished by that insurance company. If there are questions regarding the illustration, please contact a representative of the other insurance company.”
Comparison
TF: Testimonials, appraisals, and analyses used in advertisements must conform to the following requirements:
They must be genuine;
They must represent the current opinion of the author;
They must be applicable to the policy advertised; and
They must be accurately reproduced.
True
TF: Advertisements may not state or imply that an insurer, its financial condition, the payment of its claims, or the agent is recommended or endorsed by any state or federal governmental agency
True
TF; If an individual is paid for making a testimonial, that fact must be included in the advertisement.
True
The rules for illustrations apply to all group and individual life insurance policies except the following:
Variable life insurance;
Individual and group annuity contracts;
Credit life insurance; and
Life insurance policies with no illustrated death benefits on any individual exceeding $10,000.
True
TF; Illustrations should contain the following basic information:
Name of Insurer;
Name and business address of the producer;
Name, age, and sex of insured;
Underwriting or rating classification upon which the illustration is based;
Policy’s generic name, company product name, and form number;
Initial death benefit;
Dividend option election or application of non-guaranteed elements, if applicable; and
Illustration date.
True
The policy, the application, and any attachments or riders constitute the ____ ____ between the parties.
Entire Contract
TF: The policy must provide that all premiums are payable in advance at the home office of the company that issues the policy or to an agent of the company on delivery of a receipt signed by at least one of the company officers designated in the policy.
True
The policy must provide for a grace period of at least ___ ___ or _____ days for the payment of every premium after the first, during which period the policy will remain in full force and effect.
one month
31
A policy in force for two years from its date of issue during the lifetime of the insured is _____, except for nonpayment of premiums.
incontestable
The policy must provide that, in the absence of fraud, a statement made by an insured is considered a _____ and not a _____.
representation
warranty
TF: The policy must provide that if the age of the insured has been misstated, the amount payable under the policy will be such as the premium paid would have purchased at the correct age.
True
Unless the policy has been surrendered for its cash surrender value or unless the paid-up term insurance has expired, the policy will be reinstated at any time within ____ ____ from the date of premium default upon written application, evidence of insurability satisfactory to the insurer, and payment of all premiums in arrears with interest.
three years
The policy must provide that settlement will be made upon receipt of or not later than ____ ____ after due proof of death of the insured and the right of the claimant to the proceeds.
2 months
The policy must not contain a provision limiting the time for any legal action to less than ____ ____ after the cause of action.
two years
TF: Any policy of life insurance may provide for the acceleration of death benefits in advance of the time such benefits would otherwise be payable upon the occurrence of a terminal or long-term care illness or injury. The amount of the accelerated benefit is deducted from the amount of the death benefit payable under the policy and any amount the insured would otherwise be entitled to convert to an individual contract.
True
If a group policy is terminated and a person has been insured under the group policy for at least ____ years, the person is entitled to be issued an individual life insurance policy within ____ days of group policy termination. The individual policy will be issued with a face amount up to that provided by the group policy.
5
31
___ ____ policies are taken out by a creditor to cover the life of a debtor. The policyholder is the creditor, and the debtor is the insured
Credit Life
Credit life policies ensure the creditor is repaid the debt if the debtor dies. The policies cover the amount of the debt and are ______-term policies.
Decreasing
The date of termination for a credit life policy may not be more than ____ days from the scheduled maturity date of indebtedness, except when extended without additional cost to the debtor.
15
If the policyowner fails to make premium payments, the policy will lapse. _____ _____ protect the cash value of permanent life insurance policies (whole life, universal life, etc.) Insurers must provide at least one of the following _____ _____ (same):
Reduced, Paid-up Coverage;
Extended Term Coverage;
Shortened Benefit Period; and
Cash.
Nonforfeiture Options
An entire life insurance policy in Texas consists of:
Select one:
a. Policy only
b. Policy, application and any attachments or riders
c. Policy and application
d. Application only
B
