PRIMERICA LIFE INSURANC u u
E EXAM/194 QUESTIONS AND
u u u u
ANSWERS (A+) u
An insured purchased an insurance policy 5 years ag
u u u u u u u u
o. Last year, she received a dividend check from the in
u u u u u u u u u u
surance company that was not taxable. This year, sh u u u u u u u u
e did not receive a check from the insurer. From what t
u u u u u u u u u u u
ype of insurer did the insured purchase the policy?
u u u u u u u u
a. mutual
u
b. reciprocal
u
c. nonprofit service organization
u u u
d. stock - √Answer>A. mutual
u u u u
funds not paid out after paying claims and other opera
u u u u u u u u u
ting costs are returned to the policy owners in the form
u u u u u u u u u u u
of a dividend. if all funds are paid out, no dividends are
u u u u u u u u u u u u
paid
Quiz :Following a career change, an insured is no lon
u u u u u u u u u
ger required to perform many physical activities, so h
u u u u u u u u
e has implemented a program where he walks and jog
u u u u u u u u u
s for 45 minutes each morning. The insured has also e
u u u u u u u u u u
liminated most fatty foods from his diet. Which metho u u u u u u u u
d of dealing with risk does this scenario describe?
u u u u u u u u
a. retention
u
,b. reductionu
c. transfer u
d. avoidance - √Answer>B. reduction
u u u u
the insured's change in lifestyle and habits would likel
u u u u u u u u
y reduce the chances of health problems
u u u u u u
Quiz :In insurance, an offer is usually made when
u u u u u u u u
a. an applicant submits an application to the insurer
u u u u u u u u
b. the insurer approves the application and receives t
u u u u u u u u
he initial premium
u u
c. the agent hands the policy to the policyholder
u u u u u u u u
d. an agent explains a policy to a potential applicant -
u u u u u u u u u u
√Answer>A. an applicant submits an application to th
u u u u u u u u
e insurer
u
in insurance, the offer is usually made by the applican
u u u u u u u u u
t in the form of an application. acceptance takes place
u u u u u u u u u u
when an insurer's underwriter approves the applicati
u u u u u u
on and issues a policy
u u u u
Quiz :the causes of loss insured against in an insuran
u u u u u u u u u
ce policy are known as
u u u u
a. perils u
b. losses u
c. risks u
d. hazards - √Answer>A. perils
u u u u
,perils are the causes of loss insured against in an insu
u u u u u u u u u u
rance policy u
Quiz :what documentation grants express authority t
u u u u u u
o an agent?
u u
a. agents contract with the principal
u u u u u
b. agents insurance license
u u u
c. fiduciary contract
u u
d. state provisions -
u u u
√Answer>A. agents contract with the principal
u u u u u u
the principal grants authority to an agent through the a
u u u u u u u u u
gent's contract u
Quiz :which of the following best describes an insuran
u u u u u u u u
ce company that has been formed under the laws of th
u u u u u u u u u u
is state?
u
a. domestic
u
b. sovereign
u
c. alienu
d. foreign - √Answer>A. domestic
u u u u
a company is domestic when doing business within th
u u u u u u u u
e state in which it is incorporated
u u u u u u
Quiz :which of the following factors is NOT considere
u u u u u u u u
d by an underwriter when determining the premium ra
u u u u u u u u
tes for an individual seeking insurance?
u u u u u
, a. medical history
u u
b. sex u
c. age u
d. race - √Answer>D. race
u u u u
age, medical history, and sex provide sound statistica
u u u u u u u
l date for determining the probability of loss. Race, reli
u u u u u u u u u
gion, sexual orientation, etc. are the factors that cann
u u u u u u u u
ot be used because there is not sound statistical data t
u u u u u u u u u u
o show that they effect the probability of loss; therefor
u u u u u u u u u
e, they are considered to be discriminatory
u u u u u u
Quiz :in insurance transactions, fiduciary responsibili
u u u u u
ty means u
a. handling insurer funds in a trust capacity
u u u u u u u
b. maintaining good credit record
u u u u
c. being liable with respect to payment of claims
u u u u u u u u
d. commingling premiums with agents personal fund
u u u u u u
s- u
√Answer>A. handling insurer funds in a trust capacity
u u u u u u u u
an agents fiduciary responsibility includes handling in
u u u u u u
surer funds in a trust capacity
u u u u u
Quiz :the authority granted to an agent through the ag
u u u u u u u u u
ent's contract is referred to as
u u u u u
a. absolute authority
u u
E EXAM/194 QUESTIONS AND
u u u u
ANSWERS (A+) u
An insured purchased an insurance policy 5 years ag
u u u u u u u u
o. Last year, she received a dividend check from the in
u u u u u u u u u u
surance company that was not taxable. This year, sh u u u u u u u u
e did not receive a check from the insurer. From what t
u u u u u u u u u u u
ype of insurer did the insured purchase the policy?
u u u u u u u u
a. mutual
u
b. reciprocal
u
c. nonprofit service organization
u u u
d. stock - √Answer>A. mutual
u u u u
funds not paid out after paying claims and other opera
u u u u u u u u u
ting costs are returned to the policy owners in the form
u u u u u u u u u u u
of a dividend. if all funds are paid out, no dividends are
u u u u u u u u u u u u
paid
Quiz :Following a career change, an insured is no lon
u u u u u u u u u
ger required to perform many physical activities, so h
u u u u u u u u
e has implemented a program where he walks and jog
u u u u u u u u u
s for 45 minutes each morning. The insured has also e
u u u u u u u u u u
liminated most fatty foods from his diet. Which metho u u u u u u u u
d of dealing with risk does this scenario describe?
u u u u u u u u
a. retention
u
,b. reductionu
c. transfer u
d. avoidance - √Answer>B. reduction
u u u u
the insured's change in lifestyle and habits would likel
u u u u u u u u
y reduce the chances of health problems
u u u u u u
Quiz :In insurance, an offer is usually made when
u u u u u u u u
a. an applicant submits an application to the insurer
u u u u u u u u
b. the insurer approves the application and receives t
u u u u u u u u
he initial premium
u u
c. the agent hands the policy to the policyholder
u u u u u u u u
d. an agent explains a policy to a potential applicant -
u u u u u u u u u u
√Answer>A. an applicant submits an application to th
u u u u u u u u
e insurer
u
in insurance, the offer is usually made by the applican
u u u u u u u u u
t in the form of an application. acceptance takes place
u u u u u u u u u u
when an insurer's underwriter approves the applicati
u u u u u u
on and issues a policy
u u u u
Quiz :the causes of loss insured against in an insuran
u u u u u u u u u
ce policy are known as
u u u u
a. perils u
b. losses u
c. risks u
d. hazards - √Answer>A. perils
u u u u
,perils are the causes of loss insured against in an insu
u u u u u u u u u u
rance policy u
Quiz :what documentation grants express authority t
u u u u u u
o an agent?
u u
a. agents contract with the principal
u u u u u
b. agents insurance license
u u u
c. fiduciary contract
u u
d. state provisions -
u u u
√Answer>A. agents contract with the principal
u u u u u u
the principal grants authority to an agent through the a
u u u u u u u u u
gent's contract u
Quiz :which of the following best describes an insuran
u u u u u u u u
ce company that has been formed under the laws of th
u u u u u u u u u u
is state?
u
a. domestic
u
b. sovereign
u
c. alienu
d. foreign - √Answer>A. domestic
u u u u
a company is domestic when doing business within th
u u u u u u u u
e state in which it is incorporated
u u u u u u
Quiz :which of the following factors is NOT considere
u u u u u u u u
d by an underwriter when determining the premium ra
u u u u u u u u
tes for an individual seeking insurance?
u u u u u
, a. medical history
u u
b. sex u
c. age u
d. race - √Answer>D. race
u u u u
age, medical history, and sex provide sound statistica
u u u u u u u
l date for determining the probability of loss. Race, reli
u u u u u u u u u
gion, sexual orientation, etc. are the factors that cann
u u u u u u u u
ot be used because there is not sound statistical data t
u u u u u u u u u u
o show that they effect the probability of loss; therefor
u u u u u u u u u
e, they are considered to be discriminatory
u u u u u u
Quiz :in insurance transactions, fiduciary responsibili
u u u u u
ty means u
a. handling insurer funds in a trust capacity
u u u u u u u
b. maintaining good credit record
u u u u
c. being liable with respect to payment of claims
u u u u u u u u
d. commingling premiums with agents personal fund
u u u u u u
s- u
√Answer>A. handling insurer funds in a trust capacity
u u u u u u u u
an agents fiduciary responsibility includes handling in
u u u u u u
surer funds in a trust capacity
u u u u u
Quiz :the authority granted to an agent through the ag
u u u u u u u u u
ent's contract is referred to as
u u u u u
a. absolute authority
u u
