Life Flashcards
(295 cards)
1
Q
An applicant who pays the initial premium at the time of application is typically given a(n)
certified receipt
official receipt
conditional receipt
binding receipt
A
The correct answer is “conditional receipt”. A conditional receipt is normally given to an applicant who pays the initial premium at the time of application.
2
Q
Under a life insurance policy, the ________ has the authority to name the beneficiary.
owner
agent
underwriter
beneficiary
A
The policyowner has the authority to name the beneficiary of a life insurance policy.
3
Q
Which action could result in a hearing being ordered by the Department of Financial Services?
Conducting insurance business in this state while being a resident of another
Representing a foreign insurer
Sharing commissions with another licensed agent
Performing insurance transactions without a license
A
A hearing may be conducted if anyone is suspected of engaging in the business of insurance without a license.
D
4
Q
Which entity approves the insurance policy forms used in Florida?
Department of Financial Services (DFS)
Office of Insurance Regulation (OIR)
National Association of Insurance Commissioners (NAIC)
Financial Services Commission (FSC)
A
The correct answer is “Office of Insurance Regulation (OIR)”. The insurance policy forms used in Florida are approved by the Office of Insurance Regulation (OIR).
B
5
Q
An example of an unfair trade practice is
replacing an old life insurance policy with a new one
an agent writing less than 50% of their total sales from controlled business
an agent making a material misrepresentation to the insured
denying payment of a claim within a reasonable time after proof of loss statements were provided
A
Making a material misrepresentation to an insured is considered to be an unfair trade practice.
C
6
Q
What are adjustable rates for life policy loans in Florida based on?
90-day treasury bill rate
National average of other states’ variable rate
Moody’s corporate bond index
Prime lending rate
A
Adjustable rates for life insurance policy loans in Florida are based on Moody’s corporate bond index.
C
7
Q
When replacing or exchanging an annuity, the agent must disclose to the annuitant
proof of appointment by the agent
the possible tax ramifications as a result of the transaction
the commissions to be paid as a result of the transaction
the insurer’s A.M. Best rating
A
The correct answer is “the possible tax ramifications as a result of the transaction”. An agent must disclose the possible tax consequences of replacing or exchanging an existing annuity or life insurance policy.
B
8
Q
An example of rebating would be
offering a client something of value not stated in the contract in exchange for their business
using intimidation in order to restrain or monopolize the business of insurance.
reducing the premiums across the board for a specific risk class
a mutual insurance company paying dividends to its policyowners
A
Rebating can be defined as offering a prospect something of value that is not specified in a contract in order to induce the purchase of that contract.
A
9
Q
An example of sliding would be
replacing an existing insurance policy with a new one
speaking maliciously of an insurer intending to harm
inducing an applicant to purchase an insurance policy by returning some of the premium
charging for an additional product without the applicant’s consent
A
The correct answer is “charging for an additional product without the applicant’s consent”. Sliding involves selling additional coverage to an insurance applicant who doesn’t want or need it. An agent will often “slide” this additional coverage in without the customer’s knowledge or consent
D
10
Q
Which of the following employees may NOT be excluded from a group life plan?
Seasonal workers
Full-time employees before the probationary period
Full-time employees after the probationary period
Part-time employees
A
The correct answer is “Full time employees after the probationary period”. All of these employees may be excluded from a group life plan except for “Full time employees after the probationary period”.
C
11
Q
Which of the following is a standard provision of the conversion privileges in a Group Life policy?
Group Life coverage can normally be converted to an individual policy within 6 months
Group Life coverage can only be converted if the employer pays for the individual policy
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
Group Life coverage can only be converted by providing evidence of insurability
A
Conversion at regular rates on an attained-age basis without a medical exam is a standard provision for conversion privileges in Group Life policies.
C
12
Q
Any violations of the Florida financial institutions code may be investigated by the
Department of Homeland Security (DHS)
Office of Insurance Regulation (OIR)
Attorney General’s office
Department of Financial Services (DFS)
A
The correct answer is “Department of Financial Services (DFS)”. The DFS has the authority to investigate violations or potential violations of the Florida financial institutions code.
D
13
Q
Which of the following situations are NOT subject to Florida life insurance laws?
Insurance companies’ life policy replacement requirements
Insurance companies’ guidelines for paying a life insurance claim
Insurance companies’ setting of life insurance policy rates
Insurance companies’ day-to-day operations
A
Insurance companies’ day-to-day operations
D
14
Q
Defamation occurs when an agent makes a false statement intended to
replace an existing insurance policy with another
restrict fair trade
misrepresent the provisions of an insurance policy
malign another insurer
A
The correct answer is “malign another insurer”. Defamation is an unfair trade practice involving false, maliciously critical, or derogatory statements intended to injure a person or company engaged in the insurance business.
D
15
Q
Which of the following is NOT required on every insurance application sold in Florida?
Address and phone number of the agent
Agent’s name
Agent’s license number
Insurer’s name
A
All of these must be shown on every insurance application sold in Florida EXCEPT “Address and phone number of the agent”.
A
16
Q
A life insurance policyowner may sell their policy to a(n) _____ in order to receive a percentage of the policy’s face value.
viator agent
broker
viatical settlement provider
insurer
A
The correct answer is “viatical settlement provider”. To receive a percentage of the policy face value, an owner of a life policy may sell the policy to a viatical settlement provider.
C
17
Q
If a policyowner does not pay the premium by the due date, the
policyowner can make the premium payment during the grace period
policy must be reinstated
policyowner is automatically assessed a late charge
insurance company cancels the policy
A
If a policyowner does not pay the premium by the due date, the premium may be paid during the grace period.
A
18
Q
A life insurance policyowner would like to file a complaint against a life insurance agent. In Florida, the entity that oversees these complaints is called the
Office of Insurance Regulation
Department of Financial Services
Securities Exchange Commission
Department of Homeland Security
A
The correct answer is “Department of Financial Services (DFS).” The Department of Financial Services (DFS), specifically the DFS Division of Consumer Services, oversees complaints against life insurance agents and agencies selling life insurance products.
B
19
Q
Which of these is NOT a legal entity for selling life insurance in Florida?
Independent agency system
Risk management advisers
Personal producing general agency
Career agency system
A
Risk management advisers do not qualify as a legal entity for selling life insurance.
B
20
Q
A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan’s termination?
31 days
14 days
60 days
45 days
A
The correct answer is “31 days”. If a group plan is terminated, covered persons are guaranteed coverage for 31 days after termination.
A
21
Q
A life insurance policy’s grace period entitles the insured a period of no less than ___ days to make the premium payment.
40
25
35
30
A
The grace period for a life insurance policy is never less than 30 days.
D
22
Q
A license may be denied, suspended, or revoked if the licensee
does not meet a sales quota
engages in replacement of an existing policy
is found guilty of misrepresentation
files for bankruptcy
A
Being found guilty of misrepresentation may result in the Department of Financial Services denying, suspending, revoking, or not renewing any license.
C
23
Q
According to Florida law, a Group Life insurance policy requires a minimum of how many insureds?
2
No minimum
100
25
A
In Florida, there is no minimum number of insureds required for a group life insurance policy.
B
24
Q
According to Florida’s life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary Statement when it’s requested by
the Financial Services Commission
the insurer
the policyowner
the Chief Financial Officer
A
The replacement of existing life insurance policies with new contracts of life insurance requires a written Comparison and Summary Statement at the policyowner’s request.
C
25
Within how many days must a licensee notify the Department of Financial Services of a change in address?
60
90
30
120
30
The correct answer is "30". All licensees are required to notify the Department of Financial Services of a change in address within 30 days.
26
All of the following are Nonforfeiture Options EXCEPT
Extended Term Option
Automatic Premium Loan Option
Reduced Paid-Up Option
Cash Surrender Option
An automatic premium loan is not considered a Nonforfeiture Option.
B
27
All of the following are eligibility requirements for an association group EXCEPT
Contributory plans require a minimum of 25 participants
Group must hold regular meetings at least on an annual basis
Must have been organized for some reason other than to obtain group insurance
Group must have been in existence for two years
A minimum of 100 participants is required for a contributory plan.
A
28
In Florida, which of the following is considered an Unfair Trade Practice?
Coercion
Replacement
Subrogation
Aleatory
Coercion is considered an unfair trade practice under Florida law.
A
29
In Florida, most life insurance policies have a contestability period of
3 years
1 year
4 years
2 years
2 Years
D
30
J is an agent who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of?
Twisting
Sliding
Coercion
Rebating
The correct answer is "Twisting". Twisting is the unfair trade practice of replacing an insurance policy from one insurer to another based on misrepresentation.
A
31
K is insured under a Group Life insurance policy. K is considered to be a(n)
beneficiary
policyowner
certificate holder
annuitant
Each person covered under a Group Life insurance policy is considered to be a certificate holder.
C
32
One definition of replacement is "the act of replacing an existing insurance policy with another". Replacement is
allowed only if the policy originated outside the state of Florida
closely regulated and requires full disclosure
not legal in the state of Florida
legal and requires no disclosure
The correct answer is "closely regulated and requires full disclosure". Replacement of insurance policies is strictly regulated and requires full disclosure.
B
33
The Financial Services Commission may hold hearings
for any reason deemed necessary
when approved by the NAIC
only when a felony is involved
only if there is a complaint filed
The Financial Services Commission may hold hearings for any purpose within the scope of the insurance code deemed necessary.
A
34
In an insurance contract, the element that shows each party is giving something of value is called
consideration
offer
acceptance
purpose
Consideration
A
35
Which of these will have the highest monthly payout upon annuitization?
Life with period certain
Joint and survivor life
Joint life
Straight life
The correct answer is, "Straight life". A straight life annuity will have the highest monthly payout.
D
36
The least expensive option to pay off a 30-year mortgage balance would be
adjustable term life
decreasing term life
increasing term life
convertible term life
The correct answer is, "decreasing term life". The least expensive option to pay off a 30-year mortgage balance would be decreasing term life.
B
37
A life insurance policy that is subject to a contract interest rate is referred to as
group life
term life
adjustable life
universal life
The correct answer is, "universal life". Universal life is subject to a contract interest rate or a current annual interest rate.
D
38
The type of multiple protection coverage that pays on the death of the last person is called a(n)
survivorship life policy
annuity joint policy
joint life policy
dual life policy
The correct answer is, "survivorship life policy". Under a multiple protective policy, the policy that pays on the death of the last person is called a survivorship life policy.
A
39
An employee under a group insurance policy has the right to name a beneficiary and the right to
cash surrender the existing policy
convert to an individual policy in the event of employment termination
change the policy provisions
remain on the group plan in the event of employment termination
The correct answer is, "convert to an individual policy in the event of employment termination". A person whose life is insured under a group insurance policy has the right to designate a beneficiary and the right to have an individual policy issued in the case of termination of employment.
B
40
The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as
Aleatory
Apparent
Unilateral
Estoppel
The correct answer is, "Aleatory". Aleatory is a term that describes the fact that both parties of a contract may NOT receive the same value.
A
41
Under a contract of adhesion,
the insurer's obligations are dependent upon certain acts of the insured individual
only one party makes any kind of enforceable promise
the terms must be accepted or rejected in full
there is the potential for an unequal exchange of value
C Under a contract of adhesion, the contract has been prepared by one party (the insurance company) with no negotiation between the applicant and insurer. In effect, the applicant "adheres" to the terms of the contract on a "take it or leave it" basis when accepted.
C
42
A Renewable Term Life insurance policy can be renewed
at a predetermined date or age, regardless of the insured's health
only if the insured provides evidence of insurability
anytime at the policyowner's request
typically with no change in premium
The correct answer is, "at a predetermined date or age, regardless of the insured's health". Renewable Term Life insurance guarantees the policy can be renewed to a predetermined date or age, regardless of the insured's health status.
A
43
The coverage, conditions, and limitations in the master policy of a group contract can be found in which document?
Coverage document
Certificate of coverage and benefits
Certificate of Authority
Consumer report
The certificate of coverage and benefits describes the coverage, conditions, and limitations found in the master policy of a group contract.
B
44
All of these are settlement options for life insurance policies EXCEPT
Life income
Lump sum
Fixed period
Extended term
The correct answer is, "Extended term". The extended term option is a nonforfeiture option, not a settlement option.
D
45
Jonas is a whole life insurance policyowner and would like to add coverage for his two children. Which of the following products would allow him to accomplish this?
Child term rider
Family income rider
Family maintenance rider
Payor rider
A child term rider is level term insurance that can be added to an existing policy.
A
46
What would be an accurate definition of "controlled business"?
Insurance business that is written on the agent's own life, property, or interests
Insurance business that is obtained through false advertising
Insurance business that is obtained by replacing an existing policy through misrepresentation
Insurance business obtained by an agent through coercion, intimidation, or boycotting
"Controlled business" is insurance business that is written on the agent's own life, property, or interests.
A
47
W gave W's age as 50 when W purchased a Life policy. At the time of W's death seven years later, the company discovered W's true age at issue had been 59. What would the normal procedure be under the misstatement of age provision in regard to the payment of the death claim?
The insurer is only obligated to refund all premiums paid
The proceeds would be reduced based on whatever the premium would have been if purchased at age 59
The policy's full death benefit would be paid, due to the expiration of the incontestable period
There would be no death proceeds paid out by the insurer
In this situation, the proceeds will be reduced based on whatever the premium would have been if purchased at age 59.
B
48
What is Florida's definition of Life insurance replacement?
A transaction in which coverage on an existing policy is increased
A transaction in which a new policy is bought and an old policy is terminated
A transaction in which a policyowner reinstates a lapsed policy
A transaction in which group life coverage is converted to an individual policy
Florida's Replacement Rule defines replacement of Life insurance as a transaction in which a new policy is bought and an old policy is discontinued.
B
49
Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy?
A list of all policies the agent has replaced in the last 3 years
Notice to existing and replacing insurers of intention to replace
A statement made by the agent that NAIC guidelines have been met during the replacement process
A copy of the agent's insurance license
When replacing an existing life insurance policy, an agent must submit notice to existing insurer and replacing insurer of intentions.
B
50
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product?
Policy summary
Illustration
Conditional receipt
Buyer's guide
The correct answer is "Buyer's guide". Agents can help prospective insureds understand and purchase the most appropriate product by delivering a buyer's guide.
B
51
Which of the following factors is NOT considered when the Department of Financial Services determines if an agent's home is an insurance agency?
The amount of premium collected at this location
Listing the address on the agent's business cards
Clients are met at this location
Business solicitation is done at this location
The Department of Financial Services does not take into consideration the amount of premium collected at an agent's home when determining whether or not the home is an insurance agency.
D
52
Which of the following types of insureds are life insurance companies allowed to make policy rate discriminations against?
People of different races
People that smoke
People of different religions
People that are married
A life insurance company may make policy rate discriminations against people that smoke.
B
53
In Florida, an element of an insurance transaction would be
setting up the sales appointment
determining how much coverage is needed
issuing an insurance contract
ordering an MIB report
The issuance of an insurance contract is considered to be an element of an insurance transaction.
C
54
Which type of insurance company allows their policyowners to elect a governing body?
Mixed
Mutual
Admitted
Stock
The correct answer is "Mutual". Policyholders elect the governing bodies of mutual insurance companies.
B
55
A life policy loan in Florida cannot charge a fixed rate of interest higher than
9%
10%
7%
8%
The correct answer is "10%". The maximum fixed interest rate permitted on a life policy loan is 10%.
B
56
Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share of stock?
Sliding
Intimidation
Twisting
Misrepresentation
If an agent tells an applicant that an insurance policy is like a share of stock, the agent may be guilty of misrepresentation.
D
57
A variable life insurance agent must be licensed and appointed as a life and variable contract agent, as well as a(n)
accredited agent
Registered Managing Agent (RMA)
Certified Variable Dealer (CVD)
broker dealer
The correct answer is "broker dealer". An agent marketing variable life insurance must be licensed and appointed as a life and variable contract agent and a broker dealer.
D
58
In Florida, what is the maximum percentage of controlled business an agent may produce?
60%
30%
50%
40%
The correct answer is "50%". In Florida, an agent's controlled business may NOT exceed a maximum of 50%.
C
59
Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?
Sliding
Fraud
Coercion
Misrepresentation
An agent who tells a client that dividends are guaranteed may be guilty of misrepresentation.
D
60
According to Florida law, group life insurance conversion privileges must NOT
allow a time period to convert group life coverage to an individual life policy
require evidence of insurability
require a rate increase
allow the converted policy to exceed 75% of the original group life amount
The correct answer is "require evidence of insurability". Florida's insurance law that governs group life insurance conversion privileges provides that the individual policies do not require evidence of insurability.
B
61
According to Florida law, which of the following information does NOT need to be obtained by an agent recommending an annuity purchase?
Annual income
Financial objectives
Age
Marital status
Marital status
62
A stock life insurance company that issues both participating and nonparticipating policies is doing business on
an assorted plan
a multiple plan
a diverse plan
a mixed plan
When a stock life insurance company issues both participating and nonparticipating policies, the company is doing business on a mixed plan.
D
63
Who is a mutual insurance company owned by?
Its employees
Its board of directors
The State of Florida
Its policyholders
A mutual insurance company is owned by its policyholders.
D
64
According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with
a Certificate of Coverage and Buyer's Guide
a Buyer's Guide and Policy Summary
a Written Comparison and Policy Summary
a Summary Statement and Buyer's Guide
The correct answer is "a Buyer's Guide and a Policy Summary". Florida's rules on disclosure require an insurance company to provide a purchaser of life insurance with a Buyer's Guide and a Policy Summary.
B
65
An agent that sells _________ Life insurance MUST be registered with the Financial Industry Regulatory Authority (FINRA).
Credit
Universal
Straight
Variable
The correct answer is "Variable". An agent is required to register with the Financial Industry Regulatory Authority (FINRA) in order to sell Variable Life insurance policies.
D
66
An insurance company can contest a life insurance contract due to application fraud within
3 years
1 year
60 days
2 years
The correct answer is "2 years". There is a 2 year time limit for an insurer to contest a life insurance contract due to application fraud.
D
67
Florida's 14-day free-look period for life insurance policies begins at the
date of delivery
date of application
date of approval
date of physical examination
The correct answer is "date of delivery". In Florida, the free-look period for life insurance contracts is 14 days from policy delivery.
A
68
All of the following will result in the suspension of an agent's license EXCEPT
forging a name on an insurance application
intentionally misrepresenting the provisions of a policy
acting with fiduciary responsibility
being convicted of a felony
Acting as a fiduciary would not result in suspension of an agent's license.
C
69
70
Which of the following situations does NOT apply to the Florida Replacement Rule?
An existing policy is subject to extensive borrowing
An existing policyholder purchases an additional policy from the same insurer
An existing policy is reissued with a reduction in cash value
A new policy is issued while an existing one is surrendered
Florida's Replacement Rule applies to all of these situations EXCEPT "An existing policyholder purchases an additional policy from the same insurer".
B
71
Which of the following professional organizations has its code of ethics incorporated into Florida law?
National Association of Insurance and Financial Advisors (NAIFA)
National Association of Insurance Commissioners (NAIC)
The American College of Life Insurance
Financial Industry Regulatory Agency (FINRA)
The correct answer is "National Association of Insurance and Financial Advisors (NAIFA)". The professional organization whose code of ethics is incorporated into Florida law, and whose responsibility is to establish the activities of agents is the National Association of Insurance and Financial Advisors.
A
72
A foreign insurance company doing business in Florida
is only authorized to write business outside the United States
is a company that was formed under the laws of another state
is not subject to Florida insurance laws
is a company that was formed under the laws of another country
The correct answer is "is a company that was formed under the laws of another state". In Florida, a foreign insurance company is a company that is formed under the laws of a state other than Florida.
B
73
Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency?
National Association of Insurance Commissioners (NAIC)
Office of Insurance Regulation
Department of Financial Services
Florida Insurance Guaranty Fund Association
The correct answer is "Florida Insurance Guaranty Fund Association". The Florida Insurance Guaranty Fund Association exists to protect an insured in the event of an insurer's insolvency.
D
74
In Florida, deceptive advertising is considered to be
a form of rebating
a form of coercion
a form of sliding
a form of misrepresentation
According to Florida law, deceptive advertising is considered a form of misrepresentation.
B
75
Agents that have been licensed for less than six years must complete __ hours of continuing education every two years.
20
36
8
24
24
76
Group Life policies in Florida are required to contain a conversion privilege that allows for conversion
to an individual policy at anytime
with evidence of insurability
to an individual policy for a stated period of time
only if the premiums are paid by the employer
Correct. In Florida, Group Life policies must contain a conversion privilege that allows for conversion to an individual policy for a specified period of time.
C
77
If an agent would like to sell Variable annuities, which state examination must the agent pass?
Life insurance
Life and Variable contracts
Variable annuities
Accident and Health insurance
The correct answer is "Life and Variable contracts". An agent who wants to sell Variable annuities must be licensed by the state which includes examinations in Life and Variable contracts.
Continue
78
In Florida, which employee is eligible for an employer's group term life plan?
Employee who works part-time
Employee who works more than 40 hours per week
Employee who works seasonally during the summer
Full time employee not actively at work
All of these employees may be EXCLUDED for group term life coverage EXCEPT "Employee who works more than 40 hours per week".
79
T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as
legal competence
fiduciary responsibility
reasonable trust
ethical behavior
Fiduciary responsibility involves an agent handling funds of a client or insurance company honestly and fairly, and not using them for the agent's own purposes.
80
The act of an insurance company publishing misleading information about its policy's provisions is called
coercion
twisting
intimidation
false advertising
An insurance company that publishes misleading information about insurance coverage may be found guilty of false advertising.
81
Which of the following employer tasks does a Professional Employer Organization normally handle?
Marketing strategies
Administration tasks
Hiring staff
Setting sales quotas
The correct answer is "Administration tasks". A Professional Employer Organization typically handles administration functions.
82
In Florida, an insurer licensed to conduct business in Florida, but domiciled in New Jersey, is called a(n)
foreign company
domestic company
non-admitted company
alien company
An insurance company that is domiciled in New Jersey and licensed to conduct business in Florida is referred to in Florida as a foreign company.
83
A stock insurance company
guarantees dividends to its shareholders
is owned exclusively by its policyowners
elects a governing body by its policyowners
is owned exclusively by its shareholders
Correct. A stock insurance company is best defined as an incorporated company that has its capital divided into shares and is owned exclusively by its shareholders.
84
In Florida, which agency is responsible for the rehabilitation or liquidation of insurers?
Department of Financial Services (DFS)
Office of the Attorney General (OAG)
Office of Financial Regulation (OFR)
Office of Consumer Affairs (OCA)
Correct. The Department of Financial Services (DFS) is responsible for the rehabilitation or liquidation of insurers when necessary.
Continue
85
If an agent would like to sell Variable annuities, which state examination must the agent pass?
Accident and Health insurance
Life and Variable contracts
Life insurance
Variable annuities
The correct answer is "Life and Variable contracts". An agent who wants to sell Variable annuities must be licensed by the state which includes examinations in Life and Variable contracts.
86
Insurance companies that are organized in countries outside the United States are referred to as
foreign
alien
domestic
international
Alien
87
The insurer must provide a prospective buyer with a(n)
copy of the application
actuarial table
A.M. Best report
Buyer's Guide and Policy Summary
The insurer must provide a prospective buyer with a Buyer’s Guide and Policy Summary.
88
A non-contributory health insurance plan helps the insurer avoid
tax deductions
the underwriting process
state compliance
adverse selection
Because all eligible employees are usually covered, noncontributory plans are desirable from an underwriting standpoint because adverse selection is minimized.
89
Under a group life policy, the insurer will issue an individual _____ to the policyowner for delivery to each person insured.
certificate
policy
application
rider
Correct. The insurer will issue an individual certificate to the policyowner for delivery to each person insured under a group life policy.
90
Lisa has recently bought a fixed annuity. Which of these is considered to be a disadvantage of owning this type of annuity?
Payments cease 5 years after the annuitant's death
During periods of inflation, annuitants will experience a decrease in purchasing power of their payments
During periods of inflation, annuitants will experience an increase in purchasing power of their payments
Payment amounts can be unpredictable from month to month
The disadvantage of fixed annuities is annuitants could experience a decrease in the purchasing power of their payments over a period of years due to inflation.
Continue
91
Julie has a $100,000 30-year mortgage on her new home. What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30-year period?
Decreasing term insurance
Modified life insurance
Adjustable life insurance
Increasing term insurance
The correct answer is, "Decreasing term insurance". Decreasing term insurance is normally used to pay off a mortgage balance in the event of death of the insured.
92
The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority?
apparent
discreet
implied
express
The correct answer is, "implied". Implied authority is the unwritten authority that is not expressly granted, but which the agent is assumed to have in order to transact the business of the principal.
C
93
A Modified Endowment Contract (MEC) is best described as
An annuity contract which was converted from a life insurance contract
A life insurance contract which accumulates cash values higher than the IRS will allow
A life insurance contract where all withdrawals prior to age 65 are subject to a 10% penalty
A modified life contract which enjoys all the tax advantages of whole life insurance
The correct answer is, "A life insurance contract which accumulates cash values higher than the IRS will allow". A Modified Endowment Contract (MEC) can be described as a life insurance contract that has accumulated cash values higher than the IRS allows.
94
The minimum age at which a person can sign a life insurance application is
15 years
17 years
16 years
18 years
15 years
95
Which of the following activities will NOT result in the suspension of an agent's license?
Making malicious and false statements about an insurer
Misrepresenting any fact about an insurance policy
Replacing an insurance policy from one insurer to another based on misrepresentation
Working for a foreign insurer
Working for a foreign insurance company does not result in the revocation or suspension of an agent's license.
96
When replacing or exchanging an annuity, the agent must disclose to the annuitant
proof of appointment by the agent
the insurer's A.M. Best rating
the possible tax ramifications as a result of the transaction
the commissions to be paid as a result of the transaction
the possible tax ramifications as a result of the transaction
97
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product?
Conditional receipt
Illustration
Buyer's guide
Policy summary
Buyer's guide
98
An example of unfair discrimination would be
offering different premiums for individuals of the same risk classification
declining an insurance application because of involvement in a hazardous occupation
issuing a policy at a substandard rate because of poor health
offering the same premiums for individuals of the same risk classification
. Providing different terms of coverage for different policyowners in the same risk classification would be an example of unfair discrimination.
99
Convincing a prospective insured to buy an insurance policy based on exaggerations is called
misrepresentation
rebating
twisting
intimidation
misrepresentation
100
Which of the following is considered to be misrepresentation?
Representing a foreign insurer
An agent guaranteeing a policy's dividends
Sharing commissions with other licensed agents
Replacing an existing policy with a new one
Stating that dividends are guaranteed is considered a misrepresentation.
101
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission
Financial Industry Regulatory Authority; and Department of Financial Services
National Association of Insurance and Financial Advisors; and Securities Exchange Commission
National Association of Insurance Commissioners; and Department of Financial Services
Department of Financial Services; and Securities Exchange Commission
102
Which of the following is NOT a consequence for placing business with an unauthorized insurer?
Responsible for unpaid claims
First degree misdemeanor
Third degree felony
Insurance license revoked
First degree misdemeanor
103
__________ can be defined as "using the contract values of an existing policy to purchase a new policy with an existing insurer".
Churning
Defamation
Misrepresentation
Twisting
he correct answer is "Churning". Churning can be defined as "using the contract values of an existing policy to purchase a new policy with an existing insurer".
104
A life policy loan in Florida cannot charge a fixed rate of interest higher than
8%
7%
10%
9%
he correct answer is "10%". The maximum fixed interest rate permitted on a life policy loan is 10%.
105
In Florida, when agents recommend changes be made for existing coverage, the agent must follow established procedures. The name of this rule is called the
Florida Solicitation Law
Gramm-Leach-Bliley Act
Florida Replacement Rule
Existing Coverage Statute
The Florida Replacement Rule sets forth the requirements and procedures to be followed by insurance companies and producers when replacing existing life insurance contracts.
106
According to Florida law, which of the following statements accurately describes an admitted mail order insurance company?
Admitted mail order insurance companies cannot solicit insurance business outside the state of Florida
Admitted mail order insurance companies are illegal in Florida
It may solicit insurance business by mail only with the assistance of a licensed Florida agent
It may solicit insurance business by mail without the assistance of a licensed agen
It may solicit insurance business by mail only with the assistance of a licensed Florida agent". An admitted mail order insurance company may solicit and accept business by mail only with the assistance of a licensed Florida agent.
107
In order for a domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?
The state where they are conducting business
The attorney general in the state where they are domiciled
The National Association of Insurance Commissioners (NAIC)
Homeland Security
Domestic, foreign, or alien companies must be authorized by each state where they conduct business.
108
J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
No obligation is required from either the insurance company nor J
All of the employees must be notified of the cancellation either by the insurance company or through J
J must cover the group with another policy at cancellation
The insurance company must replace the existing policy with one to J's liking
An insurer must notify each certificate holder (employee) when the master policy has expired or is being cancelled. The insurer may take such action through the policyholder (employer).
109
The Bureau of Unclaimed Property is overseen by the
Chief Financial Officer
Insurance Department
Unclaimed Property Commissioner
Governor
Chief Financial Officer
110
The Department may request all of these during the licensing application process EXCEPT
fingerprints
proof of citizenship
drug test
fees
drug test
111
The Insurance Guaranty Fund Association is
administered by the Federal government
an entity that assists in underwriting large insurance policies
funded by admitted insurance companies through assessments
funded by the state government
funded by admitted insurance companies through assessments". The Insurance Guaranty Fund Association is funded by insurance companies through assessments and will pay claims if an insurance company becomes insolvent.
112
A type of group that has a constitution and bylaws and has been organized for purposes other than obtaining insurance is called a(n)
association or labor group
113
Fixed period settlement options are considered to be a form of a(n)
The correct answer is, "annuity". A fixed period settlement option is actually a form of an annuity.
114
What does the word "level" in Level Term describe?
The premium payments
The cash value
The period of coverage
The face amount
The face amount
115
A renewable Term Life insurance policy allows the policyowner the right to renew the policy
at anytime the policyowner chooses
without producing proof of insurability
paying the same premium as before the renewal
as many times as the policyowner chooses
without producing proof of insurability". If Term Life insurance is renewable, the policyowner is purchasing the right to renew the policy without showing proof of insurability.
116
Andy the annuitant dies before the annuity start date. Which of the following is a TRUE statement?
Premiums paid plus interest earned is returned to the beneficiary
117
Where would policy proceeds be paid if both the insured and primary beneficiary were killed in the same accident?
contingent beneficiary
118
When a decreasing term policy is purchased, it contains a decreasing death benefit and
level premiums
increasing premiums
decreasing premiums
variable premiums
level premiums
119
Donald is the primary insured of a life insurance policy and adds a children's term rider. What is the advantage of adding this rider?
Coverage can be different for each child
Increases the policy's overall cash value
Can be converted to permanent coverage without evidence of insurability
Premiums on this rider are not required until the limiting age is reached
Can be converted to permanent coverage without evidence of insurability.An advantage of a children's term rider is the ability to convert to permanent insurance without evidence of insurability.
120
A spouse and child can be added to the primary insured's coverage as what kind of rider?
Guaranteed insurability
Primary term
Family term
Dependent term
Family term". A family term rider allows both spouse and child to be added to the primary insured's coverage.
121
What makes an insurance policy a unilateral contract?
Only the insured can change the provisions
Only the insured pays the premium
Only the insurer is legally bound
Only the insured is legally boun
Only the insurer is legally bound. Insurance contracts are unilateral, meaning that only the insurer makes legally enforceable promises in the contract.
122
Joe has a life insurance policy that has a face amount of $300,000. After a number of years, the policy's cash value accumulates to $50,000 and the face amount becomes $350,000. What kind of policy is this?
Modified Whole Life policy
Universal Life policy
Increasing Term Life policy
Nonparticipating policy
Universal Life policy
123
Which of these would be the best example of a limited pay life insurance policy?
Whole life policy with premiums paid up after 20 years
Term life policy with premiums paid up after 20 years
Term life policy that returns cash value after 20 years
Whole life policy that pays out its cash value over a 20 year period
Whole life policy with premiums paid up after 20 years". A whole life insurance policy where the premiums are paid up after 20 years would be considered a limited pay life insurance policy.
124
Proceeds from a life insurance policy are protected from the beneficiary's creditors by which clause?
beneficiary trust clause
creditor clause
spendthrift trust clause
protection clause
spendthrift trust clause
125
Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index. What kind of policy is this?
Modified Endowment Contract
Equity index whole life
Current assumptive whole life
Credit life insurance
"Equity index whole life". The type of policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index is equity index whole life.
126
What happens to the total amount of premium paid for an insurance policy when the payment frequency increases?
Decreases
Increases
No difference in cost
Depends on the type of coverage
The correct answer is, "Increases". As the premium payment frequency increases, the total amount of premium paid for an insurance policy increases.
127
Ambiguities in an insurance policy are always resolved in favor of the
producer
insurer
underwriter
insured
"insured". Ambiguities in an insurance policy are always resolved in favor of the insured.
128
Level premium term life insurance policies
automatically renew at predetermined dates
automatically convert to permanent insurance at a predetermined date
build cash value in a separate account
have premiums that are averaged over the policy period
have premiums that are averaged over the policy period
.The policyowner pays more in the early years for protection to help cover the cost in later years, which allows the premiums to remain level throughout the life of the policy.
129
In order for a contract to be valid, it must
be signed and witnessed by an attorney
be filed with the state
be in writing
contain an offer and acceptance
The correct answer is, "contain an offer and acceptance". For a contract to be valid it MUST include an offer and an acceptance.
130
According to life insurance contract law, insurable interest exists
at the time of death
at the time of application
only when determined by a judge
when any business relationship exists
at the time of application
131
he deeds and actions of a producer indicate what kind of authority?
Conditional
Apparent
Implied
Express
Apparent
Apparent authority is the appearance or assumption of authority based on the actions, words, or deeds of the producer.
132
An agent's license can be suspended or revoked by
writing primarily controlled business
issuing a binding receipt
replacing an existing insurance policy with a new one
not meeting annual sales quota
"writing primarily controlled business". An agent's license can be suspended or revoked by writing primarily controlled business.
133
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
Defamation
Coercion
Rebating
Misrepresentation
"Coercion". A creditor who requires a debtor to obtain insurance from a particular company or agent as a condition for a loan is guilty of coercion.
134
Which of the following is considered an accurate statement of an unfair trade practice?
Coercion involves making a malicious statement about the financial condition of an insurance company
Rebating occurs when someone intentionally deceives another with the intent to gain financially
Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that they can purchase a new life insurance policy with another company
No more than 25% of an agent's insurance sales are allowed to come from controlled business
wisting is a misrepresentation made by an agent in order to induce a policyholder to lapse a policy and switch insurance companies. It's considered an unfair trade practice.
135
During the course of an insurance transaction, if an agent makes a false or incomplete statement, he/she could be found guilty of
twisting
misrepresentation
sliding
replacement
misrepresentation
136
Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer?
Rebating
Sliding
Misrepresentation
Coercion
Misrepresentation.Making a fraudulent statement on an insurance application would be considered an act of misrepresentation.
137
According to Florida law, an additional lapse notice must be issued after the standard grace period has expired for policyowners age
69 or older
59 1/2 or older
64 years or older
21 and under
64 years or older
138
All of the following entries are classified under the four principal areas of Florida insurance law EXCEPT
Policyowner's rights
An agent's licensing requirements
An agent's commission
Policy provisions
An agent's commission
139
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?
Interest only
Installment refund
Fixed period
Life income
"Life income". The settlement option that pays a specified amount to an annuitant, but pays no residual value to a beneficiary is known as life income.
140
Which of these factors would an insurer consider when determining whether to accept a group life plan?
Grace period
Number of dependents
Average age
Incontestable period
An insurer would consider the average age when determining whether to accept a group life plan.
141
Converting a group plan to permanent life insurance requires
paying a lower premium
the conversion being applied for within 31 days of termination
submitting proof of insurability
converting to term life insurance
When converting from group to permanent life insurance, the conversion must be applied for within 31 days of termination.
142
What would be an expense factor in an insurance program?
Mortality costs
Opportunity costs
Premiums collected
Investment interest
Mortality costs
143
A beneficiary has just received a claim payment for a life insurance policy. Which of the following is TRUE regarding the federal income tax liability owed?
Tax liability owed depends on the type of life insurance policy
No federal income tax is owed on life insurance proceeds
Federal income tax is owed if proceeds exceed $250,000
A flat tax of 10% is owed on all proceeds
No federal income tax is owed on life insurance proceeds
There is no federal income tax on life insurance proceeds if you receive the proceeds under a life insurance contract as a beneficiary.
144
Index whole life insurance contains a securities component that acts as a(n)
means to lowering taxes on earnings
hedge against inflation
incentive to purchase more coverage
premium stabilizer
hedge against inflation". The securities component of index whole life insurance is considered an effective hedge against inflation.
145
Level premium permanent insurance accumulates a reserve that will eventually
require the policyowner to make periodic withdrawals
equal the face amount of the policy
pay a dividend to the policyowner
become larger than the face amount
Level premium permanent insurance accumulates a reserve that will eventually equal the face amount of the policy.
146
If the annuitant dies before the annuity start date,
the premiums paid plus interest earned will be given to the beneficiary
the premiums paid will be given to the beneficiary
nothing is given to the beneficiary
the benefits will be given tax-free only to a stated beneficiary
If the annuitant dies before the annuity start date, the beneficiary receives the premiums paid plus interest earned.
147
Karissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Which of these statements is true?
The policy automatically converts to whole life after the 10-year period
The premium will remain constant and the face amount will increase over the 10-year period
The face amount will remain constant and the premium will increase over the 10-year period
The face amount and premium will remain constant over the 10-year period
The face amount and premium will remain constant over the 10-year period". In this situation, the premium and the face amount will remain constant for the 10-year period
148
A life insurance claim which involves a per capita distribution of policy proceeds would be payable to the
named living primary beneficiaries
named contingent beneficiaries only
estate of the deceased beneficiaries only
estate of the insured only
Per capita” is a method of life insurance distribution using total number of individuals. This means that all living members that are identified in the life insurance policy will receive an equal amount of the life insurance proceeds. Using per capita distribution means that if one of the beneficiaries becomes deceased before the insured, then the other beneficiaries will simply have their share increased accordingly.
149
Rob purchased a standard whole life policy with a $500,000 death benefit when he was age 30. His insurance agent told him the policy would be paid up if he reached age 100. The present cash value of the policy equals $250,000. Rob recently died at age 60. The death benefit would be
$500,000
$750,000
$250,000
$375,000
500,000
150
Bob and Tom start a business. Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. Eventually, they retire and dissolve the business. Bob dies 12 months later. The policies continue in force with no change. Both partners are still married at the time of Bob's death. In this situation, who will receive Bob's policy proceeds?
Tom's spouse
Tom
Bob's estate
Bob's spouse
Insurable interest only has to exist at the time of the application, not at the time of the claim. Being there was no change in beneficiary prior to Bob's death, Tom will still receive the policy proceeds.
151
Insurance premium is determined by each of the following factors EXCEPT
Interest
Mortality
Expenses
Liquidity
he correct answer is, "Liquidity". All of these are factors which determine insurance premiums EXCEPT "Liquidity".
152
What types of life insurance are normally used for key employee indemnification?
joint, credit, and group life insurance
increasing term insurance
adjustable, permanent, and limited-pay life insurance
term, whole, and universal life insurance
e correct answer is, "term, whole, and universal life insurance". The types of life insurance generally used to cover key employee indemnification are term, whole, and universal life insurance.
153
Sharon is the policyowner of a $50,000 life insurance policy. Her son, Mike, is the beneficiary. If Sharon MUST obtain Mike's signature in order to change the beneficiary, what kind of beneficiary designation is this?
Irrevocable
Tertiary
Contingent
Revocable
Irrevocable
154
Which of these is NOT subject to income taxation under a Modified Endowment Contract (MEC)?
Loan against the cash value
Policy withdrawal
Death benefit
Policy dividend
e correct answer is, "Death benefit". The death benefit would NOT be subject to income tax under a Modified Endowment Contract (MEC).
155
A life insurance policy written on one contract for two people in which it is payable upon the first death is called
Joint
Split
Survivorship
Shared
The correct answer is, "Joint". A joint life insurance policy covers the lives of two people and is payable upon the first death.
156
Which of the following best describes a conditional insurance contract?
A contract where one party "adheres" to the terms of the contract
A contract that has the potential for the unequal exchange of consideration for both parties
A contract where only one party makes any kind of enforceable contract
A contract that requires certain conditions or acts by the insured individual
"A contract that requires certain conditions or acts by the insured individual". An insurance contract is conditional. This means that the insurer's promise to pay benefits depends on the occurrence of an event covered by the contract.
157
All of these are characteristics of a universal life insurance policy EXCEPT
Flexible premiums
Fixed surrender value
Flexible death benefit
Builds cash value
"Fixed surrender value". A fixed surrender value is NOT a characteristic of a universal life insurance policy.
158
A professional liability for which producers can be sued for mistakes of putting a policy into effect is called
fiduciary trust
errors and oversights
fiduciary bond
errors and omissions
errors and omissions
159
A securities license is required for a life insurance producer to sell
variable life insurance
modified life insurance
universal life insurance
Modified Endowment Contracts (MEC)
variable life insurance". A life insurance producer needs to possess a securities license to sell variable annuities.
160
Intentional withholding of material facts that would affect an insurance policy's validity is called a(n)
estoppel
misrepresentation
concealment
adhesion
Deliberate withholding of material facts that would affect the validity of an insurance policy or a claim under the policy is known as concealment.
161
Decreasing term life insurance is often used to
provide coverage for a home mortgage
accumulate cash value
provide retirement funds
provide coverage for estate taxes
A common use for decreasing term life insurance is to cover a home mortgage.
162
Which of these is affected by the frequency of an insurance policy's premium payments?
Cash value
Cost
Death benefit
Settlement options
cost
163
According to the principle of Utmost Good Faith, the insured will answer questions on the application to the best of their knowledge and pay the required premium, while the insurer will deal fairly with the insured and it's
promises made
issuance of the policy
underwriting
legal reserve
promises made". Without good faith, it would be difficult to reach agreement. Without agreement, there would be no valid contract.
164
Which type of policy combines the flexibility of a universal life policy with investment choices?
Variable universal life policy
Flexible universal life policy
Adjustable universal life policy
Modified universal life policy
Variable universal life policy". When the structure and flexibility of a universal life policy are combined with investment choices, the result is a variable universal life policy.
165
A life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called
credit life
whole life
universal life
group life
Universal life has a guaranteed interest rate with the possibility to earn an interest rate that is higher than the guaranteed rate.
166
In an insurance contract, the applicant's "consideration" is the
offer and acceptance
statements made in the application and the premium
statements made in the application only
premium only
The correct answer is, "statements made in the application and the premium". The statements made in the application and the premium constitute "consideration" for a life or health insurance policy.
167
A life insurance policy normally contains a provision that restricts coverage in the event of death under all of the following situations EXCEPT
fare-paying passenger
war
suicide
pilot of personal airplane
fare-paying passenger
168
What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured?
Policy's cash value
Policy Dividend
Funeral expense fund
Specified amount of money
Specified amount of money
169
Which of the following does the FICA tax fund
Social Security(OASDI) and Unemployment benefits
Medicare and Railroad Retirement System benefits
Social Security(OASDI) and Medicare benefits
Unemployment and Medicaid benefits
Social Security(OASDI) and Medicare benefits
170
Which of these factors is NOT taken into account when determining an applicant's life insurance needs?
savings
automobile
Social Security
pension
automobile
171
Which of these retirement plans do NOT qualify for a federal income tax deduction?
Keogh Plan
Traditional IRA
SIMPLE Plan
Roth IRA
Roth IRA
172
Which approach predicts a person's earning potential and determines how much of that amount would be devoted to dependents?
Future value approach
Human life value approach
Needs approach
Earnings approach
173
An insurance company incorporated under the laws of the state in which its home office is located is called a(n) ____ company.
domestic
authorized
alien
foreign
domestic
174
licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?
36 months
12 months
48 months
24 months
The correct answer is "48 months". An agent's license will terminate if the agent allows 48 months to elapse without being appointed for the class or classes of insurance listed on the license.
175
Who does an agent represent during the solicitation of insurance?
The State of Florida
The Department of Financial Services
The insurance company
The client
The insurance company
176
K is an agent who made an improper sale of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay monetary restitution to the client
Pay a penalty of three times the client's loss
Provide a written apology letter
Sell the client a more appropriate annuity
Pay monetary restitution to the client
177
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called
Domestic life insurance organizations
Unauthorized insurers
Mutual life insurers
Fraternal life insurance organizations
Fraternal life insurance organizations
178
What is the main reason for regulating the insurance industry?
Maintain the solvency of insurance companies
Controlling the replacement of existing insurance policies
Setting sales quotas for insurers
Add revenue to Florida's treasury
Maintain the solvency of insurance companies
179
Which of these is NOT considered to be a purpose of an annuity?
Annuities are intended to distribute accumulated principal
Annuities are intended to liquidate an estate
Annuities are intended for the tax-free growth of principal
Annuities are intended to create an estate
Annuities are intended to create an estate
180
Tim is covered under a group plan and would like to change his group coverage to an individual policy with the same insurer because of employment termination. Which of these describes the change that will take place?
Extension of benefits
Coordination of benefits
Conversion
Rollover
Conversion
181
All of the following are characteristics of a Group Life Insurance Plan EXCEPT
Group underwriting
Individual underwriting
Probationary period
Master contract
Individual underwriting
182
Legal purpose is a term used in contract law meaning
there must be an offer and acceptance
the contract must be aleatory
there must be legal reasons for entering into the contract
the contract must be a contract of adhesion
In contract law, legal purpose refers to the fact that the reasons for entering into a contract must be legal.
183
The greater of the accumulated cash value or the total premium paid
The interest earned on the accumulated cash value
Nothing
The lesser of the accumulated cash value or the total premium paid
The greater of the accumulated cash value or the total premium paid
184
What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as?
guarantee
representation
collateral
warranty
"representation". Statements by an applicant concerning personal health history, family health history, occupation, and hobbies are referred to as representations.
185
An example of naming a beneficiary by class would be
To Ned Jackson
To the children born of my union with Ned Jackson
To the child born of my union with Ned Jackson: Scott Jackson
To the children born of my union with Ned Jackson: David Jackson, Jennifer Jackson, and Scott Jackson
To the children born of my union with Ned Jackson
186
Naming a contingent beneficiary as "all surviving children" is described by which term?
Contingent designation
Primary designation
Class designation
Tertiary designation
Naming a contingent beneficiary as "all surviving children" is described by which term?
Contingent designation
Primary designation
Class designation
Tertiary designation
187
What is a corridor in relation to a Universal Life insurance policy?
The amount of interest that has accumulated in the policy's cash value
The gap between when a claim is filed and when the death benefit is received
The point in time when the policy's cash value reaches $0
The gap between the total death benefit and the policy's cash value
The gap between the total death benefit and the policy's cash value
188
A life insurance policy which contains cash values that vary according to its investment performance of stocks is called
Variable Whole Life
Increasing Term Life
Modified Whole Life
Adjustable Whole Life
A Variable Whole Life policy has cash values that vary according to the investment performance of common stocks.
189
Which of the following policies does NOT build cash value?
Variable Life
Term
Endowment
Straight Life
Term
190
Which of these ensures that proceeds of a life insurance policy will be free from attachment or seizure by the beneficiary's creditors?
Settlement Clause
Viatical Clause
Protection Clause
Spendthrift Clause
A Spendthrift Clause is a statement in a settlement agreement that indicates that the proceeds of the policy will be free from attachment or seizure by the beneficiary's creditors.
191
hich of these premium payment frequencies is not typically available to a policyowner?
Semi-annual
Bi-weekly
Monthly
Quarterly
The correct answer is, "Bi-weekly". A bi-weekly payment mode is normally not an option to policyowners.
192
What kind of life insurance policy covers two or more people with the death benefit payable upon the last person's death?
Dual Life insurance
Last Survivor Life insurance
Shared Life insurance
Joint Life insurance
Last Survivor Life insurance
193
Which settlement option involves having the proceeds remain with the insurer and earnings paid on a monthly basis to the beneficiary?
extended interest
fixed period
interest only
dividends only
"interest only". The settlement option that allows proceeds to remain with the insurer and earnings to be paid to the beneficiary on a monthly basis is called interest only.
194
Which of these describes the result of a modified endowment contract that failed to meet the seven-pay test?
Policy loans are disallowed
The premium payments will be tax deductible
Withdrawals will be prohibited
Pre-death distributions are typically taxable
Pre-death distributions are typically taxable". Failing to meet the seven-pay test results in pre-death distributions likely to become taxable.
195
All of the following are elements of an insurance policy EXCEPT
conditions
definitions
claim forms
other insurance
claim forms
196
Which type of life insurance policy pays the face amount at the end of the specified period if the insured is still alive?
Adjustable life policy
Modified life policy
Endowment policy
Universal life policy
"Endowment policy". A type of life insurance policy which provides for the payment of the face amount at the end of the specified period if the insured is still alive is an endowment policy.
197
A provision that allows a policyowner to withdraw a policy's cash value interest free is a(n)
grace period
automatic premium loan
waiver of premium
partial surrender
partial surrender
198
What is the primary feature of a viatical settlement?
Reduced death benefit prepayment
No interest on policy loans
Longer contestable period
Lower premiums
Reduced death benefit prepayment
199
Craig purchased a life insurance policy for enabling his heirs to pay estate taxes. What is this called?
Liquidity maintenance
Survivor fund
Estate conservation
Human value protection
Estate conservation
200
When calculating the amount of life insurance needed for an income earner, what has to be determined when using the Needs Approach?
The family's financial objectives if the income earner were to die or become disabled
The income earner's future projected income
The income earner's credit score
The insurance company's financial rating
"The family's financial objectives if the income earner were to die or become disabled". When using the needs approach to determine the amount of life insurance needed for the income earner, it is necessary to determine the family's financial objectives in the event of the death or disability of the income earner.
201
The period in which there are no Social Security benefits for the surviving spouse is called the
ineligible period
blackout period
dependency period
elimination period
blackout period. The blackout period begins when the youngest child turns 16 and continues until the spouse reaches age 60, at the earliest. If there are no eligible children with the surviving spouse when the breadwinner dies, the blackout period starts immediately.
202
An insurance producer is often responsible for field underwriting during the application process. All of these are possible field underwriting roles EXCEPT
providing disclosure information to the applicant
policy delivery
providing commission information to the applicant
collecting initial premium
providing commission information to the applicant
203
A rollover from a Traditional IRA to another IRA MUST be done within ___ days to avoid tax consequences.
30
90
60
15
60
204
Signatures for an insurance application MUST be obtained by the producer from all of the following sources EXCEPT
the beneficiary
the policyowner
the insured
the producer
the beneficiary
205
Underwriters can acquire information from all of the following sources EXCEPT
attending physician's statements
consumer reports
genetic testing
Medical Information Bureau (MIB)
genetic testing
206
Under a Traditional IRA, interest earned is taxed
during the accumulation phase
only if withdrawn prior to age 59 1/2
upon distribution
according to the capital gains rate
upon distribution
207
An applicant's character and personal habits can be obtained for underwriting purposes from which source?
Attending physician's statement
Medical Information Bureau (MIB)
Investigative consumer report
Credit report
"Investigative consumer report". An investigative consumer report is a detailed report that contains information on a consumer's character, general reputation, personal characteristics, or mode of living and is obtained through personal interviews with neighbors, friends, or associates of the consumer.
208
An individual most likely will have an insurable interest in insuring a person's life if
an economic interest exists for the continuance of the insured's life
there is any blood relationship with the insured
a financial interest exists at the time of insured's death
a business relationship exists
an economic interest exists for the continuance of the insured's life
209
An insurer has a right to screen applicants for HIV in which of the following ways?
Inquiring about risky sexual behavior
Inquiring about sexual orientation
Blood test for HIV
Automatically declining an application due to sexual orientation
Blood test for HIV
210
A whole life policy option where extended term insurance is selected is called a(n)
interest-only option
dividend option
settlement option
nonforfeiture option
nonforfeiture option
211
Which of the following would be considered an underwriting duty of an agent?
Assigning a risk classification
Completing all applications and collecting initial premiums
Accepting or declining an application
Requesting medical information from the Medical Information Bureau (MIB)
Completing all applications and collecting initial premiums
212
An endorsement found in an insurance plan which modifies the provisions of the policy is called a(n)
add-on
rider
supplement
attachment
rider
213
If an insured's age on a life insurance policy has been misstated, what is the insurer's liability if the insured dies?
No death benefit is owed because of the misstatement of age
The full original death benefit listed on the policy
A prorated death benefit based on the amount of insurance the insured's premiums would have been if purchased at the correct age
The original death benefit listed on the policy minus any outstanding loans and interest
A prorated death benefit based on the amount of insurance the insured's premiums would have been if purchased at the correct age
214
All of these are typically sources of underwriting information for life or health insurance EXCEPT
Disclosure authorization response
Consumer reports
Medical Information Bureau (MIB) reports
Attending physician's statement (APS)
Disclosure authorization response
215
James is the insured on a life insurance policy where his age was misstated on the application. Which of the following is CORRECT regarding the death benefit amount?
The death benefit paid will be what the premium would have purchased at the correct age
The amount of premiums paid will be returned with interest
The original face amount will be paid to the beneficiary
The policy will be voided with no death benefits paid
The death benefit paid will be what the premium would have purchased at the correct age
216
Kurt is an active duty serviceman who was recently killed in an accident while home on leave. Which military service exclusion clause would pay upon his death?
Status
Active
Leave
Results
Results". The "results clause" states the insurer is excused from paying the amount only if the death is a result of war.
217
Joanne 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?
Net death benefit will be reduced if the loan is not repaid
A loan can be taken out for up to the face amount of the policy
Term life policies are the only type of insurance that allows policy loans
No interest will be charged on loan balance
218
During the application process, the agent's primary responsibility is to
the insurance company
the Department of Financial Services
the applicant
the State of Florida
the insurance company
219
In Florida, an insurer domiciled and incorporated in this state is called a(n)
admitted company
domestic company
alien company
foreign company
domestic company
220
When does an immediate annuity begin making payments?
After the incontestable period
After policy has been active for one year
After multiple premiums have been paid
After the first premium has been paid
After the first premium has been paid
221
How are annuities given favorable tax treatment?
Gains are taxed at distribution
Gains are tax exempt at distribution
Gains are converted to tax credits
Gains are tax deductible
Gains are taxed at distribution
222
A business will typically use which type of life insurance to cover their employees?
Endowment policy
Adjustable life policy
Whole life policy
Group policy
Group policy
223
A beneficiary change can occur
only on specified dates within the policy
only upon the request of the revocable beneficiary
at no time
normally at any time during the policy term
normally at any time during the policy term
224
Reggie purchased a life insurance policy with a face amount of $500,000. After 15 years, the cash value has accumulated to $100,000 and the policy's face amount has become $600,000. Which type of life insurance policy is this?
Modified life
Universal life
Adjustable life
Credit life
A universal life policy pays a death claim in the amount of the death benefit plus the savings element.
225
Variable life insurance and Universal life insurance are very similar. Which of these features are held exclusively by variable universal life insurance?
Policyowner may increase or decrease the premium payments
Policyowner can contribute large sums of money
Policyowner may increase or decrease the face amount
Policyowner has the right to select the investment which will provide the greatest return
The right to select the investment which will provide the greatest return pertains only to variable universal life insurance.
226
Which of the following are the premium payments for a Universal life policy NOT used for?
Loading costs
Death benefits
Cash value
Separate account investments
Separate account investments
227
A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a(n)
variable universal policy
level term policy
adjustable policy
limited pay policy
"limited pay policy". A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a limited pay polic
228
Which contract element is insurable interest a component of?
Offer and acceptance
Consideration
Legal purpose
Competent parties
Legal purpose
229
All of these statements concerning whole life insurance are false EXCEPT
The death benefit is not affected by outstanding loans
Coverage is normally temporary
Policyowner can take out a policy loan up to the face amount
When a whole life policy is surrendered, income taxes may be owed
Correct. Income taxes may be due when a whole life policy is surrendered. This statement is true.
230
If the beneficiary dies from the same accident as the insured individual, the insurer will proceed as if
the estate was listed as beneficiary
the beneficiary outlived the insured
both the insured and beneficiary died at the same time
the insured outlived the beneficiary
the insured outlived the beneficiary. . A common disaster provision states that if the beneficiary dies from the same accident as the insured individual, the insurer will proceed as if the insured outlived the beneficiary. This allows the proceeds to go to the contingent beneficiary.
231
How are survivorship life insurance policies helpful in estate planning?
Provide funds to help pay taxes
Provide funds for funeral expenses
Provide funds to help fund retirement
Provide tax deductions for premium payments
"Provide funds to help pay taxes". Survivorship life insurance policies are useful in estate planning because they can provide money to pay taxes on assets.
232
What is implied authority defined as?
Authority given to an agent to act outside the scope of the agency agreement
Authority given to handle claims and process payments
Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties
Authority given in writing to an agent in the agency agreement
Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties
233
Which of the following is an example of the insured's consideration?
Insurer's promise to pay benefits
A paid premium
Intent
Legal purpose
A paid premium
234
Within how many days must a Traditional IRA be rolled over to another IRA in order to avoid tax consequences?
30
45
60
90
60
235
When a qualified plan starts making payments to its recipient, which of the following choices BEST describes the portion of each distribution that is taxable?
Contributions made by employee
Gains
Contributions made by employer
Principal
Gains" is BEST answer out of the choices. While the entire distribution would be taxed assuming the contributions were made pre-tax, the IRS would characterize all distributions as taxable gains. Not all qualified plans have employer contributions. Neither do all plans include employee contributions. In certain circumstances, even some traditional IRA contributions might not qualify as deductible and therefore would not be taxed when withdrawn. Gains are ALWAYS taxable. The IRS characterizes all previously untaxed distributions as gains. Therefore, "Gains" is the BEST answer among the choices given. TIP: When answering a question on a state insurance exam, watch out for words like BEST and MAXIMUM. You will also find imperfect choices, such as were presented here. When in doubt, "Pick the one that stinks the least."
236
Social Security is funded by a payroll tax imposed on a limit of an employee's income. What is this limitation called?
Average monthly wage (AMW)
Taxable wage base
Maximum wage limit
Average indexed monthly earnings (AIME)
"Taxable wage base". This payroll, or FICA tax, is applied to employees' incomes up to a certain limit, called the taxable wage base.
237
Which approach predicts a person's earning potential and determines how much of that amount would be devoted to dependents?
Future value approach
Needs approach
Human life value approach
Earnings approach
Human life value approach
238
Preferred risk policies with reduced premiums are issued by insurance companies because the insured has
a better ability to pay premiums over a long period of time
worse than average mortality or morbidity experience
a higher face amount than average
better than average mortality or morbidity experience
better than average mortality or morbidity experience
239
Which of the following signatures is not required on an individual insurance application?
Applicant
Producer
Insured
Insurer
On an individual insurance application, the insurer's signature is not required.
240
Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
Juvenile waiver
Waiver of premium
Guaranteed insurability
Payor benefit
A payor benefit will waive the premium on a juvenile life insurance policy if the parent paying the premium dies.
241
Which of the following would be a valid reason why a policy premium would be higher than the standard premium?
The insured does not meet established underwriting requirements
The agent quoted the wrong price
The insured does not have the necessary financial reserves
The insurer is not a member of the MIB
The insured does not meet established underwriting requirements
242
A waiver of premium rider allows an insured to waive premium payments if the insured is
unemployed
completely and permanently disabled
experiencing financial hardship
temporarily disabled
completely and permanently disabled
243
hen does a life insurance policy typically become effective?
When the policy is issued
When initial premium is collected and policy is issued
When the application is completed and signed
When the completed application is signed and initial premium is collected
When initial premium is collected and policy is issued
244
All of these are standard exclusions found in a life insurance policy EXCEPT
disability
war
aviation
hazardous occupations
". Disability is not one of the standard exclusions found in life insurance policies.
245
whole life insurance policy accumulates cash value that becomes
the death benefit
a source of funding a term rider to the policy
the policy loan value which the insured may borrow against
the source of funding for administration fees
the policy loan value which the insured may borrow against
246
Which scenario would most life insurance policies exclude coverage for?
A tourist traveling abroad on a major airline carrier
An individual who has a hobby racing cars once a month
An airline pilot who flies for a commercial carrier
A soldier on leave at home
"An individual who has a hobby racing cars once a month". Most life insurance policies exclude coverage for a loss arising from an auto enthusiast racing automobiles as a hobby.
247
An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of
coercion
twisting
fraud
rebating
fraud
248
An insured individual and the policy's beneficiary die from the same accident. The common disaster provision states the insurer will continue as if
the beneficiary outlived the insured
no beneficiary was ever named
the insured outlived the beneficiary
the insured and beneficiary died at the same time
the insured outlived the beneficiary
249
Barbara's policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. This rider is called a(n)
Family income rider
Payor rider
Guaranteed insurability rider
Endowment rider
A guaranteed insurability rider allows for the insured to purchase additional insurance at specific dates or events without evidence of insurability.
250
An insurance company needs to obtain personal information from a third party concerning an applicant. Which law do all insurers and their producers need to comply with?
McCarran-Ferguson Act
Fair Credit Reporting Act
USA Patriot Act
Personal Information Act
o protect the rights of consumers for whom an inspection or credit report has been requested, Congress enacted the Fair Credit Reporting Act in 1970.
251
Matt is applying for life insurance and requests a double indemnity rider. A double indemnity benefit will be payable to Matt's beneficiary if Matt
is injured in a skiing accident and dies 18 months later
dies of a stroke
is killed while committing a felony
dies instantly from a car accident
The correct answer is, "dies instantly from a car accident". Matt's beneficiary will be provided with the double indemnity rider if Matt dies instantly from a car accident.
252
Ownership of a life insurance policy may be temporarily transferred with a(n)
transferable assignment
beneficiary assignment
absolute assignment
collateral assignment
collateral assignment
253
Which of the following is a reinstatement condition?
Changes in the insuring clause
Premium increase
Premium decrease
Proof of insurability
Proof of insurability
254
Which of the following is considered to be an alternative to a life settlement?
Waiver of premium rider
Extended term option
Accelerated death benefit rider
Decreasing term insurance
Accelerated death benefit rider
255
Upon policy delivery, which of the following must a producer have an applicant sign if no initial premium was collected with the life insurance application?
An exclusion
A replacement form
A waiver of premium
A statement of good health
A statement of good health
256
A life insurance policyowner was injured in an automobile accident which results in a total and permanent disability. Which rider would pay a monthly amount because of this disability?
Disability income rider
Long-term care rider
Waiver of premium
Annuity rider
"Disability income rider". The rider which pays a life insurance policyowner a monthly amount in the event of total and permanent disability is called a disability income rider.
257
A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n)
guaranteed insurability rider
guaranteed term rider
cost of living rider
accelerated benefit rider
guaranteed insurability rider
258
All of these are considered key factors in underwriting life insurance EXCEPT
Marital status
Age
Health history
Tobacco use
Marital status
259
All of the following riders can increase the death benefit amount EXCEPT
Guaranteed Insurability
Cost of Living
Waiver of Premium
Accidental Death Rider
Waiver of Premium
260
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If the consumer price index has gone up 4%, how much may Ron increase the face value of the policy?
$400
$4,000
$800
$2,000
The correct answer is, "$4,000". In this situation, Ron may increase the face value of his policy by $4,000. $100,000 X .04 = $4,000.
261
What is an insurer required to do when faced with an error made under the Misstatement of Age provision?
Cancel the policy
Pay full benefits as stated in the policy
Bill the policyowner for back premiums
Pay age-corrected benefits
Pay age-corrected benefits
262
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract
once each year
twice each year
once each month
only when requested by the policyowner
once each year
263
Florida resident insurance agents must complete __ hours of law and ethics continuing education every two years.
5
6
4
3
4
264
How many days does an insurance company have to reject a reinstatement application before it is automatically reinstated?
60
31
45
120
45
265
Converting a group plan to permanent life insurance requires
submitting proof of insurability
paying a lower premium
converting to term life insurance
the conversion being applied for within 31 days of termination
The correct answer is, "the conversion being applied for within 31 days of termination". When converting from group to permanent life insurance, the conversion must be applied for within 31 days of termination.
266
An interest-sensitive life insurance policyowner may be able to withdraw the policy's cash value interest free. The provision that allows this is called
Accelerated Death Benefit
Subrogation
Partial Surrender
Automatic Premium Loan
Partial Surrender
267
What makes an insurance policy a unilateral contract?
Only the insured is legally bound
Only the insurer is legally bound
Only the insured pays the premium
Only the insured can change the provisions
Only the insurer is legally bound
268
Which of the following is considered to be the period when the accumulated value in an annuity is paid out?
Period certain phase
Accumulation phase
Annuitization phase
Principal phase
"Annuitization phase". The period when the annuitant starts to receive payments from the annuity is the annuitization phase.
269
Which of these is NOT subject to income taxation under a Modified Endowment Contract (MEC)?
Death benefit
Policy withdrawal
Loan against the cash value
Policy dividend
Death benefit
270
A partial surrender is allowed in which of the following life policies?
Decreasing term life
Adjustable whole life
Universal life
Limited whole life
Universal life
271
Which of the following best describes a conditional insurance contract?
A contract that requires certain conditions or acts by the insured individual
A contract where only one party makes any kind of enforceable contract
A contract that has the potential for the unequal exchange of consideration for both parties
A contract where one party "adheres" to the terms of the contract
A contract that requires certain conditions or acts by the insured individual
272
A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a(n)
adjustable policy
variable universal policy
limited pay policy
level term policy
limited pay policy
273
All of these are characteristics of a universal life insurance policy EXCEPT
Fixed surrender value
Builds cash value
Flexible premiums
Flexible death benefit
Fixed surrender value
274
A policyowner can receive an immediate payment before the insured dies by using a(n)
adhesion agreement
buy-sell arrangement
spendthrift plan
viatical settlement contract
viatical settlement contract
275
According to life insurance contract law, insurable interest exists
only when determined by a judge
when any business relationship exists
at the time of application
at the time of death
at the time of application". According to life insurance in contract law, a person most likely will have an insurable interest in insuring a person's life if at the time of application
276
Decreasing term life insurance is often used to
provide retirement funds
provide coverage for a home mortgage
accumulate cash value
provide coverage for estate taxes
provide coverage for a home mortgage
277
Which of these factors help determine an insured's life insurance premium?
insured's salary
marital status
avocation (hobby)
place of residence
avocation (hobby)
278
How are survivorship life insurance policies helpful in estate planning?
Provide tax deductions for premium payments
Provide funds to help pay taxes
Provide funds for funeral expenses
Provide funds to help fund retirement
Provide funds to help pay taxes
279
The premium payment mode that results in the highest overall cost would be
annual
quarterly
monthly
semi-annual
monthly
280
Which of these ensures that proceeds of a life insurance policy will be free from attachment or seizure by the beneficiary's creditors?
Viatical Clause
Settlement Clause
Spendthrift Clause
Protection Clause
Spendthrift Clause
281
Which of these describes the result of a modified endowment contract that failed to meet the seven-pay test?
Pre-death distributions are typically taxable
The premium payments will be tax deductible
Policy loans are disallowed
Withdrawals will be prohibited
Failing to meet the seven-pay test results in pre-death distributions likely to become taxable.
282
What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured?
Specified amount of money
Policy Dividend
Policy's cash value
Funeral expense fund
Specified amount of money
283
How long does the elimination period last for a Social Security Disability claimant?
0 months
12 months
6 months
5 months
"5 months". Social Security Disability benefits are subject to rigid requirements. Disability benefits begin after the worker has satisfied a waiting or elimination period of 5 consecutive months, during which the worker must be disabled. The disability must be expected to last a minimum of 12 months.
284
Dana is an employee who deposits a percentage of her income into her individual annuity. Her company also contributes a percentage into a separate company pension plan. What kind of annuity is this considered?
Qualified retirement annuity
Keogh annuity plan
Executive compensation plan
Key employee retirement annuity
Qualified retirement annuity
285
What would happen if a life insurance applicant is given a conditional receipt from an insurance agent and then dies the next day?
Claim will be paid if money was received by the insurance company
Claim will be paid if underwriter has received the application
Claim will be denied by insurer
Claim will be paid if application is approved
Claim will be paid if application is approved
286
Which of these is NOT a characteristic of the Accelerated Death Benefit option?
The benefit can be offered as a rider at a specific extra cost or may be at no cost
The face amount and policy premium are not affected by the payment
There may be a dollar limit on the maximum benefit
Before payment of the benefit is made, specific conditions must exist, such as suffering from a terminal illness
The benefit can be offered as a rider at a specific extra cost or may be at no cost
287
In regards to a life insurance contract, which of the following statements is NOT true regarding the concept of insurable interest?
Individuals are assumed to have insurable interest in themselves
Insurable interest must exist at the time of the application
Insurable interest is established by a court of law
Insurable interest can be established sufficiently by sentimental attachment alone
Insurable interest can be established sufficiently by sentimental attachment alone
288
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
Paid-Up Additions Option
Accumulation at Interest Option
Cash Dividend Option
One-Year Term Dividend Option
Accumulation at Interest Option
289
Statements made by an insurance applicant on an application are considered to be
warranties
irrevocable
guarantees
representations
representations
290
What is the purpose for having an accelerated death benefit on a life insurance policy?
It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill
It allows for policy loans to be advanced to the insured in the event of unemployment
It allows for a spouse to be added as a rider to a life insurance policy
It allows for a third party to purchase a life insurance policy at a discounted rate and immediately advance a portion of the death benefit
t allows for cash advances to be paid against the death benefit if the insured becomes terminally ill". An accelerated death benefit allows for cash advances to be paid against the death benefit if the insured becomes terminally ill.
291
A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n)
cost of living rider
guaranteed insurability rider
accelerated benefit rider
guaranteed term rider
guaranteed insurability rider
292
Which of these is considered to be a Living Benefit option in a life insurance policy?
Reinstatement
Payor benefit
Waiver of premium
Accelerated death benefit
Accelerated death benefit
293
All of the following riders can increase the death benefit amount EXCEPT
Guaranteed Insurability
Cost of Living
Accidental Death Rider
Waiver of Premium
Waiver of Premium
294
Of the following dividend options, which of these is taxable?
One year term
Accumulation at interest
Paid-up additions
Reduction of premium
Accumulation at interest
295
