WV State Life Insurance Exam LATEST 2024 EXAM
QUESTION AND ANSWER GRADED A+
A group-owned insurance company that is formed to assume and spread the liability
risks of its members is known as a: - ANSWER: Risk retention group
Which of the following requires insurers to disclose when an applicant's consumer or
credit history is being investigated? - ANSWER: 1970-Fair Credit Reporting Act
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the
first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange
of unequal values reflects which of the following insurance contract features? -
ANSWER: Aleatory
The stated amount or percent of liquid assets that an insurer must have on hand that
will satisfy future obligations to its policyholders is called: - ANSWER: Reserves
All of the following are considered to be typical characteristics describing the nature
of an insurance contract, EXCEPT: - ANSWER: Bilateral
What year was the McCarran-Ferguson Act enacted? - ANSWER: 1945
Which of the following consists of an offer, acceptance, and consideration? -
ANSWER: Contract
Who elects the governing body of a mutual insurance company? - ANSWER:
Policyholders
Insurance policies are considered aleatory contracts because: - ANSWER:
Performance is conditioned upon a future occurrence
Who makes the legally enforceable promises in a unilateral contract? - ANSWER:
Insurance company
Insurance contracts are known as _____ because certain future conditions or acts
must occur before any claims can be paid. - ANSWER: Conditional
A life insurance arrangement which circumvents insurable interest statutes is called:
- ANSWER: Investor-Originated Life Insurance
In an insurance contract, the insurer is the only party who makes a legally
enforceable promise. What kind of contract is this? - ANSWER: Unilateral
When third-party ownership is involved, applicants who also happen to be the stated
primary beneficiary are required to have: - ANSWER: Insurable interest in the
proposed insured
, Which of these arrangements allows one to bypass insurable interest laws? -
ANSWER: Investor-Originated Life Insurance
When must insurable interest exist for a life insurance contract to be valid? -
ANSWER: Inception of the contract
If a contract of adhesion contains complicated language, to whom would the
interpretation be in favor of? - ANSWER: Insured
Which of these is an element of a Variable Life policy? - ANSWER: A fixed, level
premium
A father who dies within 3 years after purchasing a life insurance policy on his infant
daughter can have the policy premiums waived under which provision? - ANSWER:
Payor provision
Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies? -
ANSWER: Policyowner
Which of the following actions is NOT possible with a Universal Life policy? -
ANSWER: Premiums may be applied as a credit against income tax
Which of the following policies is characterized by a flexible premium and death
benefit and allows the policy owner control of the investment aspect of the plan? -
ANSWER: Variable universal life
A term life insurance policy matures: - ANSWER: upon the insured's death during the
term of the policy
What type of life policy covers two people and pays upon the death of the last
insured? - ANSWER: Survivorship
When is the face amount paid under a Joint Life and Survivor policy? - ANSWER:
Upon the death of the last insured
Variable Whole Life Insurance can be described as: - ANSWER: Both an insurance and
securities product
All of these characteristics of an Adjustable Life policy, EXCEPT: - ANSWER: Face
amount can be adjusted using policy dividends
Term insurance has which of the following characteristics? - ANSWER: Expires at the
end of the policy period
P is looking to purchase a life insurance policy that will pay a stated monthly income
to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end
QUESTION AND ANSWER GRADED A+
A group-owned insurance company that is formed to assume and spread the liability
risks of its members is known as a: - ANSWER: Risk retention group
Which of the following requires insurers to disclose when an applicant's consumer or
credit history is being investigated? - ANSWER: 1970-Fair Credit Reporting Act
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the
first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange
of unequal values reflects which of the following insurance contract features? -
ANSWER: Aleatory
The stated amount or percent of liquid assets that an insurer must have on hand that
will satisfy future obligations to its policyholders is called: - ANSWER: Reserves
All of the following are considered to be typical characteristics describing the nature
of an insurance contract, EXCEPT: - ANSWER: Bilateral
What year was the McCarran-Ferguson Act enacted? - ANSWER: 1945
Which of the following consists of an offer, acceptance, and consideration? -
ANSWER: Contract
Who elects the governing body of a mutual insurance company? - ANSWER:
Policyholders
Insurance policies are considered aleatory contracts because: - ANSWER:
Performance is conditioned upon a future occurrence
Who makes the legally enforceable promises in a unilateral contract? - ANSWER:
Insurance company
Insurance contracts are known as _____ because certain future conditions or acts
must occur before any claims can be paid. - ANSWER: Conditional
A life insurance arrangement which circumvents insurable interest statutes is called:
- ANSWER: Investor-Originated Life Insurance
In an insurance contract, the insurer is the only party who makes a legally
enforceable promise. What kind of contract is this? - ANSWER: Unilateral
When third-party ownership is involved, applicants who also happen to be the stated
primary beneficiary are required to have: - ANSWER: Insurable interest in the
proposed insured
, Which of these arrangements allows one to bypass insurable interest laws? -
ANSWER: Investor-Originated Life Insurance
When must insurable interest exist for a life insurance contract to be valid? -
ANSWER: Inception of the contract
If a contract of adhesion contains complicated language, to whom would the
interpretation be in favor of? - ANSWER: Insured
Which of these is an element of a Variable Life policy? - ANSWER: A fixed, level
premium
A father who dies within 3 years after purchasing a life insurance policy on his infant
daughter can have the policy premiums waived under which provision? - ANSWER:
Payor provision
Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies? -
ANSWER: Policyowner
Which of the following actions is NOT possible with a Universal Life policy? -
ANSWER: Premiums may be applied as a credit against income tax
Which of the following policies is characterized by a flexible premium and death
benefit and allows the policy owner control of the investment aspect of the plan? -
ANSWER: Variable universal life
A term life insurance policy matures: - ANSWER: upon the insured's death during the
term of the policy
What type of life policy covers two people and pays upon the death of the last
insured? - ANSWER: Survivorship
When is the face amount paid under a Joint Life and Survivor policy? - ANSWER:
Upon the death of the last insured
Variable Whole Life Insurance can be described as: - ANSWER: Both an insurance and
securities product
All of these characteristics of an Adjustable Life policy, EXCEPT: - ANSWER: Face
amount can be adjusted using policy dividends
Term insurance has which of the following characteristics? - ANSWER: Expires at the
end of the policy period
P is looking to purchase a life insurance policy that will pay a stated monthly income
to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end
