Life Insurance Exam 1 (Primerica)
Questions and Answers
401k plan - Answer- A qualified retirement plan in which the
employee can set aside a portion of their income
with pre-tax dollars.
Absolute Assignment v. Collateral
Assignment - Answer- Absolute: A permanent and irrevocable transfer
of rights and/or benefits by the policyowner.
Collateral: A temporary and/or revocable transfer
of benefits by the policyowner.
Accelerated Death Benefit - Answer- Policy provision that allows full or partial
payment of the policy's death benefit before the
insured's death if he/she is terminally ill.
Accidental Death Benefit - Answer- An extra cost rider that requires the insurance
company to pay an additional benefit in the event
that the insured dies within 90 days of an
accident as a direct result of the accident.
Accumulate at Interest - Answer- The Dividend Option where the policyowner
leaves the dividends with the insurer to invest
and earn interest.
Adhesion - Answer- Since the insurer created all the documents of
the contract, any ambiguities in the contract will
be settled in favor of the insured. Since the
insurer wrote the contract they are stuck with it
Adverse Selection - Answer- The tendency for less favorable risks to seek or
continue insurance to a greater extent than more
favorable risks.
Agency Agreement or Agency Contract - Answer- A legal document containing the
terms of the
agreement between the agent and the insurance
company. It clearly defines what an agent can
and cannot do, and how he/she will be
compensated.
Questions and Answers
401k plan - Answer- A qualified retirement plan in which the
employee can set aside a portion of their income
with pre-tax dollars.
Absolute Assignment v. Collateral
Assignment - Answer- Absolute: A permanent and irrevocable transfer
of rights and/or benefits by the policyowner.
Collateral: A temporary and/or revocable transfer
of benefits by the policyowner.
Accelerated Death Benefit - Answer- Policy provision that allows full or partial
payment of the policy's death benefit before the
insured's death if he/she is terminally ill.
Accidental Death Benefit - Answer- An extra cost rider that requires the insurance
company to pay an additional benefit in the event
that the insured dies within 90 days of an
accident as a direct result of the accident.
Accumulate at Interest - Answer- The Dividend Option where the policyowner
leaves the dividends with the insurer to invest
and earn interest.
Adhesion - Answer- Since the insurer created all the documents of
the contract, any ambiguities in the contract will
be settled in favor of the insured. Since the
insurer wrote the contract they are stuck with it
Adverse Selection - Answer- The tendency for less favorable risks to seek or
continue insurance to a greater extent than more
favorable risks.
Agency Agreement or Agency Contract - Answer- A legal document containing the
terms of the
agreement between the agent and the insurance
company. It clearly defines what an agent can
and cannot do, and how he/she will be
compensated.
