Indiana Life Insurance Exam. All Exam
Questions & Correct, Verified Answers
2023-2024 Edition. Already Graded A+
A contract sold by an insurance company that promises to pay an income to the
policyowner until his/her death is called a:
a. Survivorship Life
b. Family Income Policy
c. Straight Life Annuity
d. Modified Endowment - ANSC. Straight Life Annuity
A Family policy is constructed using what two kinds of Life insurance products?
a. Whole Life and Decreasing Term
b. Convertible Term and Decreasing Term
c. Whole Life and Level Term
d. Whole Life and Convertible Term - ANSWhole Life & Convertible Term
A full lines Producer renewing a two year license must have
a. 24 Hours of Continuing education
b. 10 Hours of Continuing education.
c. 15 Hours of Continuing education.
d. 30 Hours of Continuing education - ANS24 Hours of Continuing Education
A Keogh plan would allow an annual contribution of up to
a. 20 percent of total earned income.
b. 10 percent of total earned income.
c. 15 percent of total earned income.
d. 30 percent of total earned income. - ANS20% of total earned income
Maximum annual contributions are limited to the lesser of $30,000 or 20 percent of total
earned income (25% of the after-contribution income).
A life insurance death benefit is
a. Always credited as income and taxed on the deceased's final income tax return.
b. Not subject to Federal income tax.
c. Subject to Federal Income tax on the growth, but not on the premium dollars paid.
d. Taxed as ordinary income to the beneficiary. - ANSNot subject to Federal Income
Tax
,The fact that the death benefit of a life policy paid to the beneficiary is NOT taxed is one
of the major advantages of life insurance.
A life insurance policy that has cash value which grows faster than the cash value of a
Seven Pay Whole Life policy is known as
a. An Endowment policy.
b. Modified Life policy.
c. A Modified Endowment Contract.
d. A Modified Superstock Pro. - ANSA Modified Endowment Contract
A Multiple Indemnity rider does which of the following?
a. Waives the premium on the policy if the insured should become disabled.
b. Pays an amount in addition to the death benefit if the insured dies in an accident.
c. Pays an equal amount to a multiple number of beneficiaries.
d. Pays an amount in addition to the death benefit if the insured dies before age 60 or
65. - ANSPays an amount in addition to the death benefit if the insured dies in an
accident.
A Producer may collect both a consulting fee and a commission in the same transaction
if
a. The Producer is also licensed as a surplus lines Producer.
b. The Producer is also licensed as a consultant.
c. The Producer is also a licensed broker.
d. The Producer makes full disclosure in writing about the compensation arrangements
prior to the time that the transaction occurs. - ANSThe producer makes full disclosure in
writing about the compensation arrangements prior to the time that the transaction
occurs.
A Producer may not be licensed as a consultant, however, a Producer may act as a
consultant if they follow the proper procedures, including full disclosure of the
compensation arrangements.
A rated individual cannot select which of the following options?
a. Paid-up Additions.
b. Extended Term.
c. Reduced Paid-up.
d. Cash. - ANSExtended Term
A rated individual represents an adverse selection risk. If we allowed them to select
Extended Term as a Nonforfeiture option, it means they would have the same level of
death benefit without paying additional premium dollars.
,A Renewable Term life insurance policy is:
a. Renewable from time to time up to a certain age with renewal premium based on the
insured's attained age.
b. Automatically converted into Whole Life after a designated period of time.
c. Renewable as long as the insured can provide evidence of insurability.
d. Renewable at any age through age 100. - ANSA. Renewable from time to time up to
a certain age with renewal premium based on the insured's attained age.
A Straight Life Annuity pays
a. Until age 100.
b. Only upon the death of the annuitant.
c. Until the money in the annuity is gone.
d. Throughout the life of the annuitant. - ANSThroughout the life of the annuitant
A Term insurance policy in which the death benefit remains constant is called
a. Decreasing Term.
b. Level premium Term.
c. Level Term.
d. Increasing Term. - ANSLevel Term
Increasing Term: face amount increases over time. Decreasing term: face amount goes
down over time. Level: fixed... the face amount doesn't change over time. Level
premium: here the emphasis is on the PREMIUM, not the face amount, so the premium
is level throughout the life of the policy.
A Term insurance policy provides
a. Death benefit but no cash value.
b. Cash value but no death benefit.
c. Cash value plus a death benefit.
d. A guaranteed retirement income. - ANSDeath Benefit but no cash value
Unlike Whole Life policies, Term insurance policies do not have cash value.
A type of Annuity in which the cash values are invested in securities is called:
a. Variable
b. Deferred
c. Joint and Survivorship
d. Flexible premium - ANSVariable
, A type of Term Life Insurance that allows the policyowner to re-qualify for a lower
premium rate by passing a physical exam from time to time is known as:
a. Re-entry Term
b. Renewable Term
c. Convertible Term
d. Decreasing Premium Term - ANSA. Re-entry Term
A Whole Life policy matures at age 100. The tax implications for the
policyowner/insured are that he/she
a. Will be taxed on the entire value of the policy.
b. Will be taxed only on the interest dollars that grew in the policy, not the premium
dollars paid.
c. Will be taxed and pay a 10% penalty
d. Will not be taxed at all. - ANSWill be taxed only on the interest dollars that grew in the
policy, not the premium dollars paid.
If a policyowner/insured lived to age 100, the policy would ENDOW and the insurance
company would pay the face amount of the policy to the policyowner. However, it is
NOT a death benefit, and therefore is NOT tax free. The policyowner would be taxed on
the interest earned on the policy.
Agent Steve takes a prepaid application from applicant Cindy and issues a 30 day
Interim Term insurance receipt to Cindy. The effective date of the interim coverage will
be on the:
a. policy delivery date.
b. date of application or date of the medical exam, which ever occurs last, if the
proposed insured is insurable on that key date.
c. date of application.
d. policy issue date. - ANSC. Date of Application
Al and Betty Franken wish to obtain a mortgage from Clamdigger's National Bank. The
bank wants them to insure the property that is to be mortgaged. Which is true
concerning the bank's request?
a. The bank can legally require that the property be insured, but it cannot require that
the insurance be purchased from the bank.
b. The bank can legally require that the property be insured, and that the insurance
must be purchased from the bank.
c. The bank cannot legally require that the property be insured, but it can require that
any insurance purchased on the property be purchased from the bank.
d. The bank cannot legally require that the property be insured nor that any insurance
which is purchased be purchased from the bank. - ANSThe bank can legally require that
Questions & Correct, Verified Answers
2023-2024 Edition. Already Graded A+
A contract sold by an insurance company that promises to pay an income to the
policyowner until his/her death is called a:
a. Survivorship Life
b. Family Income Policy
c. Straight Life Annuity
d. Modified Endowment - ANSC. Straight Life Annuity
A Family policy is constructed using what two kinds of Life insurance products?
a. Whole Life and Decreasing Term
b. Convertible Term and Decreasing Term
c. Whole Life and Level Term
d. Whole Life and Convertible Term - ANSWhole Life & Convertible Term
A full lines Producer renewing a two year license must have
a. 24 Hours of Continuing education
b. 10 Hours of Continuing education.
c. 15 Hours of Continuing education.
d. 30 Hours of Continuing education - ANS24 Hours of Continuing Education
A Keogh plan would allow an annual contribution of up to
a. 20 percent of total earned income.
b. 10 percent of total earned income.
c. 15 percent of total earned income.
d. 30 percent of total earned income. - ANS20% of total earned income
Maximum annual contributions are limited to the lesser of $30,000 or 20 percent of total
earned income (25% of the after-contribution income).
A life insurance death benefit is
a. Always credited as income and taxed on the deceased's final income tax return.
b. Not subject to Federal income tax.
c. Subject to Federal Income tax on the growth, but not on the premium dollars paid.
d. Taxed as ordinary income to the beneficiary. - ANSNot subject to Federal Income
Tax
,The fact that the death benefit of a life policy paid to the beneficiary is NOT taxed is one
of the major advantages of life insurance.
A life insurance policy that has cash value which grows faster than the cash value of a
Seven Pay Whole Life policy is known as
a. An Endowment policy.
b. Modified Life policy.
c. A Modified Endowment Contract.
d. A Modified Superstock Pro. - ANSA Modified Endowment Contract
A Multiple Indemnity rider does which of the following?
a. Waives the premium on the policy if the insured should become disabled.
b. Pays an amount in addition to the death benefit if the insured dies in an accident.
c. Pays an equal amount to a multiple number of beneficiaries.
d. Pays an amount in addition to the death benefit if the insured dies before age 60 or
65. - ANSPays an amount in addition to the death benefit if the insured dies in an
accident.
A Producer may collect both a consulting fee and a commission in the same transaction
if
a. The Producer is also licensed as a surplus lines Producer.
b. The Producer is also licensed as a consultant.
c. The Producer is also a licensed broker.
d. The Producer makes full disclosure in writing about the compensation arrangements
prior to the time that the transaction occurs. - ANSThe producer makes full disclosure in
writing about the compensation arrangements prior to the time that the transaction
occurs.
A Producer may not be licensed as a consultant, however, a Producer may act as a
consultant if they follow the proper procedures, including full disclosure of the
compensation arrangements.
A rated individual cannot select which of the following options?
a. Paid-up Additions.
b. Extended Term.
c. Reduced Paid-up.
d. Cash. - ANSExtended Term
A rated individual represents an adverse selection risk. If we allowed them to select
Extended Term as a Nonforfeiture option, it means they would have the same level of
death benefit without paying additional premium dollars.
,A Renewable Term life insurance policy is:
a. Renewable from time to time up to a certain age with renewal premium based on the
insured's attained age.
b. Automatically converted into Whole Life after a designated period of time.
c. Renewable as long as the insured can provide evidence of insurability.
d. Renewable at any age through age 100. - ANSA. Renewable from time to time up to
a certain age with renewal premium based on the insured's attained age.
A Straight Life Annuity pays
a. Until age 100.
b. Only upon the death of the annuitant.
c. Until the money in the annuity is gone.
d. Throughout the life of the annuitant. - ANSThroughout the life of the annuitant
A Term insurance policy in which the death benefit remains constant is called
a. Decreasing Term.
b. Level premium Term.
c. Level Term.
d. Increasing Term. - ANSLevel Term
Increasing Term: face amount increases over time. Decreasing term: face amount goes
down over time. Level: fixed... the face amount doesn't change over time. Level
premium: here the emphasis is on the PREMIUM, not the face amount, so the premium
is level throughout the life of the policy.
A Term insurance policy provides
a. Death benefit but no cash value.
b. Cash value but no death benefit.
c. Cash value plus a death benefit.
d. A guaranteed retirement income. - ANSDeath Benefit but no cash value
Unlike Whole Life policies, Term insurance policies do not have cash value.
A type of Annuity in which the cash values are invested in securities is called:
a. Variable
b. Deferred
c. Joint and Survivorship
d. Flexible premium - ANSVariable
, A type of Term Life Insurance that allows the policyowner to re-qualify for a lower
premium rate by passing a physical exam from time to time is known as:
a. Re-entry Term
b. Renewable Term
c. Convertible Term
d. Decreasing Premium Term - ANSA. Re-entry Term
A Whole Life policy matures at age 100. The tax implications for the
policyowner/insured are that he/she
a. Will be taxed on the entire value of the policy.
b. Will be taxed only on the interest dollars that grew in the policy, not the premium
dollars paid.
c. Will be taxed and pay a 10% penalty
d. Will not be taxed at all. - ANSWill be taxed only on the interest dollars that grew in the
policy, not the premium dollars paid.
If a policyowner/insured lived to age 100, the policy would ENDOW and the insurance
company would pay the face amount of the policy to the policyowner. However, it is
NOT a death benefit, and therefore is NOT tax free. The policyowner would be taxed on
the interest earned on the policy.
Agent Steve takes a prepaid application from applicant Cindy and issues a 30 day
Interim Term insurance receipt to Cindy. The effective date of the interim coverage will
be on the:
a. policy delivery date.
b. date of application or date of the medical exam, which ever occurs last, if the
proposed insured is insurable on that key date.
c. date of application.
d. policy issue date. - ANSC. Date of Application
Al and Betty Franken wish to obtain a mortgage from Clamdigger's National Bank. The
bank wants them to insure the property that is to be mortgaged. Which is true
concerning the bank's request?
a. The bank can legally require that the property be insured, but it cannot require that
the insurance be purchased from the bank.
b. The bank can legally require that the property be insured, and that the insurance
must be purchased from the bank.
c. The bank cannot legally require that the property be insured, but it can require that
any insurance purchased on the property be purchased from the bank.
d. The bank cannot legally require that the property be insured nor that any insurance
which is purchased be purchased from the bank. - ANSThe bank can legally require that
