LIFE INSURANCE EXAM QUESTIONS
AND ANSWERS
why do equity-indexed life insurance policies have an increased premium?
for an increased amount of protection
for additional set up and maintenance costs
to pay for regulatory taxes
for the commission paid to the broker - ANSWER-for an increased amount of
protection
which of the difference between participating and non-participating policies?
participating policies pay dividends while non-participating policies do not
participating policies have lower premiums than non-participating policies
participating policy dividends are like stock dividends, non-participating dividends are
not - ANSWER-participating policies pay dividends while non-participating policies
do not
an insured and beneficiary are both killed in a fatal accident. which provision
presumes the insured survived the beneficiary?
common disaster clause
contingent beneficiary
irrevocable beneficiary
endorsement method - ANSWER-common disaster clause
which policy provision permits the policy owner to take a specified number of days to
examine the contract and allows for cancellation and a full refund if the insured
rejects the term or costs?
free look
grace period
insuring clause
exclusions - ANSWER-free look
what type pf insurance should a company purchase if it wants to insure the life of its
CEO?
group life policy
BOE insurance
key person insurance
industrial life insurance - ANSWER-key person insurance
which type of receipt makes the insurer liable for the risk from the date of application,
regardless of applicant's insurability?
, binding receipt
inspection receipt
temporary receipt
conditional receipt - ANSWER-binding receipt
why is relying solely on employer-group; life insurance generally considered
inadequate for most individuals' needs?
it does not pay off the insured mortgage
it's financially insufficient to cover end-of-life expenses
it is meant to cover funeral expenses only
it is based on salary amounts that are too low - ANSWER-it's financially insufficient
to cover end-of-life expenses
which of the following is true for a flexible premium annuity?
the actual amount of the annuity benefit is determined in advance.
a single set amount premium is paid by annuitant on an annual basis
the company promises to pay the annuitant an amount each period beginning after a
single lump sum payment
the purchaser has the option to vary the amount of each premium payment failing
between a minimum and maximum amount - ANSWER-the purchaser has the option
to vary the amount of each premium payment failing between a minimum and
maximum amount
which of the following provides for the continuance of life insurance coverage on a
juvenile in the event of the death or total disability of the individual responsible for the
payment of the premiums?
survivor benefits
family maintenance
waiver of premium
payor clause - ANSWER-payor clause
how might someone cover the extra expenses of child care and home related costs?
purchasing family term insurance
purchasing substitute insured rider
adding coverage of grandparents
adding cost of living coverage - ANSWER-purchasing family term insurance
In a level term life policy, which ALWAYS remains constant?
death benefit
premium
maximum age of the insured
beneficiary - ANSWER-death benefit
AND ANSWERS
why do equity-indexed life insurance policies have an increased premium?
for an increased amount of protection
for additional set up and maintenance costs
to pay for regulatory taxes
for the commission paid to the broker - ANSWER-for an increased amount of
protection
which of the difference between participating and non-participating policies?
participating policies pay dividends while non-participating policies do not
participating policies have lower premiums than non-participating policies
participating policy dividends are like stock dividends, non-participating dividends are
not - ANSWER-participating policies pay dividends while non-participating policies
do not
an insured and beneficiary are both killed in a fatal accident. which provision
presumes the insured survived the beneficiary?
common disaster clause
contingent beneficiary
irrevocable beneficiary
endorsement method - ANSWER-common disaster clause
which policy provision permits the policy owner to take a specified number of days to
examine the contract and allows for cancellation and a full refund if the insured
rejects the term or costs?
free look
grace period
insuring clause
exclusions - ANSWER-free look
what type pf insurance should a company purchase if it wants to insure the life of its
CEO?
group life policy
BOE insurance
key person insurance
industrial life insurance - ANSWER-key person insurance
which type of receipt makes the insurer liable for the risk from the date of application,
regardless of applicant's insurability?
, binding receipt
inspection receipt
temporary receipt
conditional receipt - ANSWER-binding receipt
why is relying solely on employer-group; life insurance generally considered
inadequate for most individuals' needs?
it does not pay off the insured mortgage
it's financially insufficient to cover end-of-life expenses
it is meant to cover funeral expenses only
it is based on salary amounts that are too low - ANSWER-it's financially insufficient
to cover end-of-life expenses
which of the following is true for a flexible premium annuity?
the actual amount of the annuity benefit is determined in advance.
a single set amount premium is paid by annuitant on an annual basis
the company promises to pay the annuitant an amount each period beginning after a
single lump sum payment
the purchaser has the option to vary the amount of each premium payment failing
between a minimum and maximum amount - ANSWER-the purchaser has the option
to vary the amount of each premium payment failing between a minimum and
maximum amount
which of the following provides for the continuance of life insurance coverage on a
juvenile in the event of the death or total disability of the individual responsible for the
payment of the premiums?
survivor benefits
family maintenance
waiver of premium
payor clause - ANSWER-payor clause
how might someone cover the extra expenses of child care and home related costs?
purchasing family term insurance
purchasing substitute insured rider
adding coverage of grandparents
adding cost of living coverage - ANSWER-purchasing family term insurance
In a level term life policy, which ALWAYS remains constant?
death benefit
premium
maximum age of the insured
beneficiary - ANSWER-death benefit
