Final Exam - North Carolina Life and Health with Verified
Solutions Graded A+
Which of the following is the MOST important factor when deciding how much
Disability Income coverage an applicant should purchase?
M completes an application for life insurance but does not pay the initial
premium. All of these actions must occur before M's policy goes into effect
EXCEPT
free-look period has expired
Additional coverage can be added to a Whole Life policy by adding a(n)
decreasing term rider
All of the following actions are considered rebating EXCEPT
sharing commissions with other licensed and appointed agents
One of the stated purposes of the Life and Health Insurance Guaranty
Association is to
assist in the prevention of insurer insolvencies
Which of the following statements is CORRECT about the period in which a Term
Policy can be converted?
It varies according to the contracts
Insurance agents MUST obtain a license from North Carolina's
Commissioner of Insurance
An accident policy will most likely pay a benefit for a(n)
off-the-job accident
K becomes ill after traveling overseas and is unable to work for 3 months. What
kind of policy would cover her loss of income?
Disability Income
K has a health policy that must be renewed by the insurer and the premiums can
only be increased if applied to the entire class of insureds. This type of policy is
considered
guaranteed renewable
M's insurance company denied a reinstatement application for her lapsed health
insurance policy. The company did not notify M of this denial. How many days
from the reinstatement application date does the insurance company have to
notify M of the denial before the policy will be automatically placed back in force?
45 days
B is a teacher who was injured in a car accident and cannot work. She is now
receiving monthly benefits as a result of this accident. Which type of policy does
B have?
Disability Income
Which of the following services is NOT covered under a hospitalization expense
policy?
surgeon's fees
Statements made on an insurance application that are believed to be true to the
best of the applicant's knowledge are called
representations
, M completes an application for life insurance but does not pay the initial
premium. All of these actions must occur before M's policy goes into effect
EXCEPT
free-look period has expired
Rick recently died and left behind an individual IRA account in his name. His
widow was forwarded the balance of the IRA. The widow qualifies for the
marital deduction
J is 35-years old and looking to purchase a whole life insurance policy. Which of
the following types of policies will provide the most rapid growth of cash value?
20-pay Life
The most important factor to consider when determining whether to convert term
insurance at the insured's attained age or the insured's original age is
cost
The Consideration clause of an insurance contract includes
the schedule and amount of premium payments
T, age 70, withdraws cash from a profit-sharing plan and purchases a Straight
Life Annuity. What will this transaction provide?
Income that cannot be outlived by the owner
If an individual has an Accidental Death and Dismemberment policy and dies, an
autopsy can be performed in all these situations EXCEPT
When the state prohibits this by law
The type of annuity that can be purchased with one monetary deposit is called
a(n)
Immediate annuity
Which of the following statements is CORRECT about accelerated death
benefits?
Must have a terminal illness to qualify
Which rider provides coverage for a child under a parent's life insurance policy?
Child term rider
Which of the following BEST describes how pre-admission certifications are
used?
Used to prevent nonessential medical costs
T is covered by an Accidental Death and Dismemberment (AD&D) policy that has
an irrevocable beneficiary. What action will the insurance company take if T
requests a change of beneficiary?
Request of the change will be refused
If the Commissioner of insurance finds that a licensed person has used
fraudulent, coercive, or dishonest practices or has proved to be incompetent,
untrustworthy, or financially irresponsible, the law allows the Commissioner to
suspend, revoke, or refuse to renew the agent's license
T took out a $50,000 life insurance policy with an Accidental Death and
Dismemberment rider. Five years later, T commits suicide. How much will the
insurer pay?
$50,000
What kind of insurance policy supplies an income stream over a set period of
time that starts when the insured dies?
Solutions Graded A+
Which of the following is the MOST important factor when deciding how much
Disability Income coverage an applicant should purchase?
M completes an application for life insurance but does not pay the initial
premium. All of these actions must occur before M's policy goes into effect
EXCEPT
free-look period has expired
Additional coverage can be added to a Whole Life policy by adding a(n)
decreasing term rider
All of the following actions are considered rebating EXCEPT
sharing commissions with other licensed and appointed agents
One of the stated purposes of the Life and Health Insurance Guaranty
Association is to
assist in the prevention of insurer insolvencies
Which of the following statements is CORRECT about the period in which a Term
Policy can be converted?
It varies according to the contracts
Insurance agents MUST obtain a license from North Carolina's
Commissioner of Insurance
An accident policy will most likely pay a benefit for a(n)
off-the-job accident
K becomes ill after traveling overseas and is unable to work for 3 months. What
kind of policy would cover her loss of income?
Disability Income
K has a health policy that must be renewed by the insurer and the premiums can
only be increased if applied to the entire class of insureds. This type of policy is
considered
guaranteed renewable
M's insurance company denied a reinstatement application for her lapsed health
insurance policy. The company did not notify M of this denial. How many days
from the reinstatement application date does the insurance company have to
notify M of the denial before the policy will be automatically placed back in force?
45 days
B is a teacher who was injured in a car accident and cannot work. She is now
receiving monthly benefits as a result of this accident. Which type of policy does
B have?
Disability Income
Which of the following services is NOT covered under a hospitalization expense
policy?
surgeon's fees
Statements made on an insurance application that are believed to be true to the
best of the applicant's knowledge are called
representations
, M completes an application for life insurance but does not pay the initial
premium. All of these actions must occur before M's policy goes into effect
EXCEPT
free-look period has expired
Rick recently died and left behind an individual IRA account in his name. His
widow was forwarded the balance of the IRA. The widow qualifies for the
marital deduction
J is 35-years old and looking to purchase a whole life insurance policy. Which of
the following types of policies will provide the most rapid growth of cash value?
20-pay Life
The most important factor to consider when determining whether to convert term
insurance at the insured's attained age or the insured's original age is
cost
The Consideration clause of an insurance contract includes
the schedule and amount of premium payments
T, age 70, withdraws cash from a profit-sharing plan and purchases a Straight
Life Annuity. What will this transaction provide?
Income that cannot be outlived by the owner
If an individual has an Accidental Death and Dismemberment policy and dies, an
autopsy can be performed in all these situations EXCEPT
When the state prohibits this by law
The type of annuity that can be purchased with one monetary deposit is called
a(n)
Immediate annuity
Which of the following statements is CORRECT about accelerated death
benefits?
Must have a terminal illness to qualify
Which rider provides coverage for a child under a parent's life insurance policy?
Child term rider
Which of the following BEST describes how pre-admission certifications are
used?
Used to prevent nonessential medical costs
T is covered by an Accidental Death and Dismemberment (AD&D) policy that has
an irrevocable beneficiary. What action will the insurance company take if T
requests a change of beneficiary?
Request of the change will be refused
If the Commissioner of insurance finds that a licensed person has used
fraudulent, coercive, or dishonest practices or has proved to be incompetent,
untrustworthy, or financially irresponsible, the law allows the Commissioner to
suspend, revoke, or refuse to renew the agent's license
T took out a $50,000 life insurance policy with an Accidental Death and
Dismemberment rider. Five years later, T commits suicide. How much will the
insurer pay?
$50,000
What kind of insurance policy supplies an income stream over a set period of
time that starts when the insured dies?
