d) The Medical Information Bureau. The NAAR for a life insurance policy is the difference between the -Both parties must follow certain conditions set forth in contract, -IRS classification of a policy that is overfunded 2)Decreasing term(premium is low) declining face value I. C. The insurer is always required to pay the . Exclusions always exist, and there is a reason for each one. Represent the insured's interest S buys a $10,000 Whole Life policy in 2003 and pays an annual premium of $100. 2)Procures insurance 4 itself from another insurer, The tax benefit of annuities is tax deferred growth. Legislative advocacy is essential to Physicians Insurance/MedChoice's purpose to protect, defend, and support our Members. -and the right to vote. Accelerated Living Benefit/Death Benefit is what type of rider? Warranty (b) tax-free exchange provision (c) Most policies can be converted to a permanent life insurance policy. D. Premiums are tax deductible as a business expense, B. All of the following are business uses of life insurance EXCEPT &\begin{array}{lr|rr} Certificate holders may convert coverage to an individual policy without evidence of insurability. Whole life policy. A company doing business in the same state it was incorporated in and owned by the policy holders. C. Domestic database of previously life and health insurance applications. D. Premiums paid are deductible as a business expense. c) 10 years. When an insured fails to disclose known facts in an application for insurance, he/she may be guilty of: A. What type of policy does the insured most likely have? d. It does not require a duty to be owed. Jason Mackenzie Alexander argues morality is a form of social technology - it is context specific and it can go out-of-date An aleatory contract is a contract where the monetary values of the parties performances are________________. b) Outline of coverage A. the application is used at the primary source of info. Despite this, the country has significantly worse healthcare outcomes when compared to peer nations. d) An insurer may exclude any debtors as to whom evidence of individual insurability is not satisfactory to the insurer. This method of estimating . Department of Defense b) Increasing Premium B) After a claim has been adjusted and is found to be covered under the policy, the insurer must pay the claim upon receipt of a signed proof of loss. 2)when benefits begin Which of the following statements about a life insurance policy is (are) true? For example, a claim will be paid only is there has been a covered loss. The remaining amounts should be charged to selling and administrative activities. C. A surplus lines broker deals with direct writing companies only -greater potential to grow the cash value but there is no guarantee D. Breach of warranty The cost of insurance protection is referred to as what? D. Solicit applications on insurer's behalf Beneficiaries are NOT required to sign the application unless they are also the owner. It has cash value that is invested into the stock market through mutual funds/securities. a) Premium amounts and surrender values The following information is taken from the records of Hammond on November 30 of the current year. An inexperienced assistant accountant has prepared the following income statement for the month of October 2017. Which of the following is a financial rating service? 2)explain any ratings 1)cont. Which of the following is true regarding the beneficiary designation of the former spouse. This type of life insurance is called Cash Accumulation C. Buy-Sell agreement D. Survivor Protection, All of the following are true of key person insurance except A. &\begin{array}{lr|rr} All of the following would be considered to be rebating EXCEPT In this case, the applicant will most likely need to fill out a Statement of Good Health. c. Using the payback period, which project should Bill choose? (a) present value of future benefits and the present value of future premiums. b) 10% for early withdrawal All of the following are true regarding health insurance policies, EXCEPT: A) An agent or producer may not make changes to the policy B) Once issued, a policy may only be changed with the approval of a company officer C) An agent may change an application with the verbal consent of the applicant A policy that does not pay dividends to policyowners is a c) Helping insureds to file claims What does it mean when a policy is limited pay life? b) Universal Life b) The policy will not be affected. A. An__________ represents the insurer. \end{array} D) They must be signed by both the Producer and the applicant. \text{Accounts Payable} & 104 & 95 & 95 & 97 \\ \textbf{EMPIRE COMPANY}\\ Statements in the application that are guaranteed true but later found to be false may result in what? D. They can decide when to pay their monthly premiums. C. Risk A. Daycare is considered to be among these expenses. Non-Participating (stock) Life Insurance Policy. a) The policyholders or stockowners of the company A. When the application is submitted without the premium its considered an invitation for the insurer to make an offer. In order for the contract or policy to be valid or legal? An insurer or producer may NOT knowingly employ an individual to act in a fiduciary capacity if that individual has been convicted of a felony or crime of moral turpitude within the past C) They must contain a warning that actual results may vary. Which of the following statements about endowment policies is true? A policy summary Companies may have immediate legal obligations following the inclusion of a substance in the Candidate List on this website including in particular Articles 7, 31 and 33 of the REACH Regulation. ____________ is a statement that is true to the best of the persons knowledge that is making the statement. a) More active. -Voting. The County is administered by a five-member Board of Supervisors who are elected for four-year terms The total of all requisitions of direct materials issued during the month is $252,230.00. D) adding cost of living coverage. a) Executive offer of the replacing company The policy's cash value grows as the investments grow. -A Mec will receive unfavorable tax treatment An agent and an applicant for a life insurance policy fill out and sign the application. \end{array} \\ The benefit is subject to the exclusionary rule When parties to a contract exchange unequal amounts of money, this is said to be what type of contract? Health insurance decreases your healthcare costs. & \text{ ???? } A. What must exist at the time of the application? IRS classification of a policy that is overfunded? All of the following statements about universal life insurance are true EXCEPT Any withdrawal of a policy's cash value reduces the amount of the death benefit. Estimated direct labor costs for next year are$440,000.00. Most agents try to collect the initial premium for submission with the application. 4)defined contribution plans. c) Guides describing company financial integrity The debtor does not have an insurable interest in the life of the lender. D) An agent's report and inspection report provides personal information. d) Paid-up option. Coverage is available in $50,000 increments up to the maximum of $400,000. O b. (d) annual premium and the annual policy dividend. 1) Conditional Reciept Company doing business in the state it was incorporated and owned by the stockholders(people who own stock) who received dividends and the right to vote???? A) An indeterminate premium reduction policy is a policy in which the premium is guaranteed for an initial period, then the insurer can charge up to a maximum premium charge that is specified in the policy. A debtor has an insurable interest in the life of a lender. Foreign. Involuntary Risk The designation will be void/. Misappropriation or illegal withholding of the policyholder's money. Who assumes control over an insurance company's funds and management if it becomes insolvent? 1) mentally incompetent persons Waiver of premium is a rider that can be added to a life insurance policy, and not something to be obtained from the applicant. Business partners have an insurable interest in each other What is the purpose of a suicide provision within a life insurance policy? C. Insured's annual expenses B) the applicant. An applicant is denied insurance because of information found on a consumer report. -car accident not in conjunction with an illness All of the following are true of insurance EXCEPT It transfers risk. 1)tax qualified plans ____________ insurer is not a type of insurer. ~~~\text{Rent on factory facilities}&60,000\\ Poor adaptation to climate change further widens the gap between what people can afford and the costs of insurance, as risks increase. O d. (c) expired. baseball, fishing | 2K views, 10 likes, 0 loves, 0 comments, 2 shares, Facebook Watch Videos from 800 Pound Gorilla Media: Robert talks about fishing in NYC, baseball, and growing up with protective. 2. Which of the following is usually true of a participating life insurance policy? 2) standard risk a) Accepted accounting principal. C. Whole life also known as acceptance. Correct: C. Consideration. The failure to disclose known facts is what? & \text { Depr } & 3,000 \\ Because the insurance company must pay claims and the insured must comply with the policy terms, the insurance contract is considered which of the following types of contracts? Which of the following would be the best option that would help the surviving spouse of the insured to put her child through daycare after the insured's death? D. The benefit is received tax free (b) The face amount of the policy is paid if the insured lives to age 65. A. d. The total of all cost sheets completed during the month is $628,880.00. c) Misrepresentation b) Adjustable life Members are assessed to fund the corporation. C. A husband or wife has an insurable interest in their spouse Conditional Contract An insurer that is incorporated in the same state that they are doing business in is a_____________.? All of the following groups may purchase group health insurance coverage, EXCEPT: Groups must have at least two employees to be eligible for group insurance coverage. \hline d) Buyer's Guide. What are the temporary needs? D) The Fair Credit Reporting Act governs what information can be collected and how the information can be used. c) Policy loans are taxable distributions. C) the proposed insured. Each policy pays a percentage of the loss based on the percentage of coverage that policy provides. Chapter 11 - Life Insurance. C. Solicit applications on the insurer's behalf Beneficiary's age ~~~\text{Raw materials purchases}&\$264,000\\ B. Carl would like to purchase life insurance. ($000)CashAccountsReceivableInventoryAccountsPayable1$1001992011042$1009650595Quarter3$10099905954$1006045297, Describe Cream Silk's promotion within the context of the multi-attribute model: Which attribute(s) were central to the promotion and how does the model explain what the company was trying to accomplish with the "Human Hair Quartet?" Correct: C. Condition contract, enforceable only under certain conditions. The demand forecast for a particular night is 130 rentals in the Super Saver class, 60 rentals in the Deluxe class, and 50 rentals in the Business class. -If the insured dies, the policy payed out the PRINCIPAL SUM (1), In Universal life, what options can the policy owner have with the premium payments to do? Based on Human Life Value Approach, which of the following is NOT used to calculate an individual's life value? Universal Life is also known as two things what are they? Cash value is invested in the stock market. 4. The insurance provides protection for a specified period of time. The face amount decreases as the amount owed on the mortgage decreases. Other factors that are named include "Mortgage underwriters, investment banks, rating agencies, and investors", "low mortgage interest rates, low short-term interest rates . 1) the premium amount B. Twisting Hazard When the company earns a profit and elects to share there profits, they pay a ____________to the policyholders or shareholders. Which of the following is an example of liquidity in a life insurance contract? RetainedEarningsDividend19,000Jul1NetIncJul3165,00065,000111,000. Explain your answer. b) Fiduciary responsibility. (2), 1)HIPPA a) Tax-qualified Forms of interest and are Sensitive Whole Life, 1) Transfers risk to another insurer B) The reduced paid-up nonforfeiture option would provide protection until the insured reaches 100, but the face amount is reduced to what the cash would buy. The application is the basic source of information an insurer uses in the risk selection process. 5)an agreement is set, 1)Level term(cheapest insurance) face value stays the same Insurance transfers risk but it does not__________ risk. To be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. Example: AIL was incorporated in Indiana and its home office is in Texas so in NJ its considered a foreign insurer. Contract or form of ownership is a ______________? B. A. Address of his principal office C. Medical Background -below market interest rates on borrowing Legal Purpose D. Represent the insured's interest -provides income for retirement b) Promptly forwarding premiums to the insurance company C. The policy is an aleatory contract A. 6)Explain Free Look period-10-30 days- unconditional refund that begins when policy is delivered. Waiver of Premium- What happens to the insurer? when the company earns a profit and elects to share these profits, they pay a dividend to the policyholders or shareholders. The policyowner can add to a policy's cash value at any time subject to policy guidelines. -the insurer sets the terms of the contract and the applicant must adhere to them. C. Certain Risk Adverse selection is well controlled. c) Conditional D. Funding against general company financial loss. b. Life insurance policy premium charged the policyowner that can be less than that guaranteed in the contract, premium increases gradually during the first few years and then levels off, All of the following statements are true regarding mortgage protection insurance EXCEPT. A securities license. -ages 25,28,34,37,40 (d) The policyowner can add to a policy's cash value at any time subject to policy guidelines. B. Correct: C. Concealment, A. (D The employer is the owner, payor and beneficiary of the policy. An agent told Carl about a form of life insurance in which Carl could select where the savings component is invested. A color-coded map illustrating the current legal status of elective-specific abortion procedures in each of the individual 50 states of the United States of America; plus U.S. territories and federal district [a] As of January 31, 2023 Illegal Legally unclear or legal but no providers Legal before cardiac-cell activity [b] Legal through 15th week LMP (1st trimester) Legal through 18th week LMP . To ensure suitability of annuity products, producers must obtain relevant information about the consumer's age, income, financial status, tax status, financial experience and objectives. A whole life insurance policy is exchanged for a term insurance policy. Most insurance policies contain a specific limit that an insurer will pay for a single claim. (d) Premiums increase at an increasing rate upon renewal. A conditional or binding receipt is given when an applicant does what? When the producer exceeds the authority expressed in the agency contract and the insurer does not take action, which type of authority is created? 3. \hline \text { Jul 1 } & 5,500 &&\\ b. it frequently includes coverage for losses due to casualty and theft. An Insurer organized in another state than the state in which it is authorized to do business is known as which type of insurer? When must insurable interest exist in a life insurance policy? A. Premiums are not tax deductible as a business expense. B) Money collected with respect to an insurance transaction must be held in a position of trust by the producer. Your device, make and model. D) the minor in a juvenile policy. D. The ratings are available to the public (a) I only She has limited income and significant life insurance needs. AccountsreceivableJul1Jul3121,000???? d) Loss. AKA-payout phase. The storage of flammables in a fireproof container. _______ pays dividends to the stock holder. B. We participate at both the national and state levels as a leading advocate in the judicial, legislative, and regulatory environment to ensure that Members' concerns are heard by lawmakers on issues that impact medical professional liability. -the premiums are paid for a limited time only. When both parties to a contract must perform certain duties in order to make the contract enforceable, this is known as what? Limited-Pay Life & Single-Premium Policies? They have made a legal arrangement which states that if one of them dies or becomes disabled, the other two wull be able to buy the partner's shares, Which term best describes this arrangement? If the insured commits suicide after the 2 year period, the policy will pay the death proceeds to the designated beneficiary the same as if the insured had died of natural causes. This is true whether a property or liability form; and regardless whether the insured is a commercial or personal lines client. \end{aligned} Past-due interest on a policy loan is added to the total debt. There are many legitimate need-based expenses that can be paid by life insurance proceeds, from groceries to retirement income. C. It's a decreasing term insurance. (d) yearly renewable term, Which statement is true concerning premature death and life expectancy? 1)Domestic Insurer -Take it or leave it contract These individuals qualify for lower premiums than those in the other categories. When an insurance policy is not clear, the court will usually interpret in favor of the insured because of which characteristic? Only the MIB will provide information about an applicant's medical history. a) Remains level. b) A producer who handles insurer funds in a trust capacity. See Answer. 3)they provide insurance to members. 3)2 death benefit option c) To protect the policyowner d) Primary and secondary beneficiary designations. C. Waiver of Estoppel Now Tamara can afford whole life insurance. 1 / 25. Question: All of the following statements about variable life insurance are true EXCEPT O a. 2)APS=medical records ~~~\text{Selling and administrative salaries}&75,000\\ (c) both I & II (d) neither I nor II. A. c) Increases annually. What insurance concept is associated with the names Weiss and Fitch? 3)Explain any riders or exclusion All of the following statements about term insurance are true EXCEPT. Participating policy. Correct: B. A) Universal Life policies allow for policyholders to withdraw a limited portion of the policy's cash value. B. Home Office- what do the underwriters do. they evaluate 4 things- what are they(4)??? B. Who are considered to be restricted persons concerning the formulation of an insurance contract. 3 of them? Rating codes are assigned to show financial strength or weakness of each company rated 2)no cash-value -has cash value invested in the stock market D. Agents report. Steven prints a pamphlet to advertise his life insurance business. 6)free-look period-$ back guaranteed. Correct: A. -marriage Exclusion Categories Liquidity in life insurance refers to availability of cash to the insured. What is a statement in the application guaranteed true in all respects? b) The elderly All of the following are common characteristics of this coverage EXCEPT 3)Consideration 2)standard-average D. The benefit is received tax free. and is NOT a party to the contract. (b) II only A) They must be given to all Life insurance applicants. When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable statement of good health b. 1. Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, ICEN6003: IC Engines Operation and Constructi. All of the following are true of insurance except: Which of the following is NOT true about insurance? The person who receives the benefit when insured dies. Hospital bills of the key employee Which type of risk involves the possibility of loss or gain? -Not a true insurance company Where does group-life insurance come from? Indicate by a plus (+)(+)(+), minus ()(-)(), or zero (0)(0)(0) if the factor would increase, decrease, or have an indeterminate effect. Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values, and death benefits for specific years? C. Concealment & \text{ ???? } Is claim still paid if there is a misstatement of age or sex? (a) capital retention approach Only one party is giving a legally enforceable promise- A one-sided contract is what? I. Most policies can be renewed for additional periods without evidence of insurability. (b) Face amount decreases during the policy period, but premiums remain level. All of the following are true about the Fair Credit Reporting Act Except: Regardless of what the consumer learns about the unfavorable information, the report can be changed by court action only. b. insured is always the borrower & the beneficiary=lender In this particular instance the applicant did not commit intentional fraud. A __________ represents the insured. How much life insurance should Sam advise . There is no limitation on the number of key employee plans in force at any one time. \end{array} D. Department of Treasury The following are all causes for the Insurance Commissioner to suspend or impose conditions upon the continuance of a producer's license EXCEPT 1. WorkinProcess$229,040.00EmployeeIncomeTaxPayable$33,880.00FactoryOverhead78,960.00SocialSecurityTaxPayable19,096.00Cash250,558.00MedicareTaxPayable4,466.00\begin{array}{lrlr}\text { Work in Process } & \$ 229,040.00 & \text { Employee Income Tax Payable } & \$ 33,880.00 \\ \text { Factory Overhead } & 78,960.00 & \text { Social Security Tax Payable } & 19,096.00 \\ \text { Cash } & 250,558.00 & \text { Medicare Tax Payable } & 4,466.00\end{array} -7 pay test is used to determine If a policy is a MEC. He would also like to invest in a mutual fund. B. Renew policy holder has an option- THE INSURER DOES NOT. \end{aligned} b) Human life value approach Everything else equal, how would the factor below affect the market value of a stock? C. Premiums are tax deductible by the key employee D) Claims result from losses by a peril insured against in an insurance policy. 2)Variable annuity When a insurance company(insurer) has too many risks exposed to loss it seek another company(reinsurers) to insure them. -birth of child. (a) I only (b) II only ~~~\text{Utilities expense}&12,000\\ C. Hazards O c. The policyowner has the option of investing the cash value in several investment accounts. B. this insurance is often written in connection with automobile loans. C. Department of State Instructions All of the following statement regarding credit life insurance are true, except: A. credit life insurance may be written on either and individual or group basis. a) A medical examination Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. In the needs approach, all of the following information is used to establish how much insurance needs to be purchased, EXCEPT: Mary should purchase $1.5 million ($75,000 x 20 working years remaining = $1,500,000). b) Conditional receipt B. Which of the following is NOT an allowable 1035 exchange? An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. The companys president is concerned about the accuracy of the income statement. B) Passing examination with 75% or higher score. 3)2 Death benefits-(level/increasing) 4)Offer and Acceptance, -direct and identifiable interest in that persons life/as well as financial interest. All of the following characterize term life insurance, EXCEPT: Select one: a. EMPIRECOMPANYIncomeStatementFortheMonthEndedOctober31,2017\begin{array}{c} \end{aligned} D) Using misrepresentation to convince a person to cancel an existing policy and buy a new one is called "twisting.". Conviction of a felony involving moral turpitude. 1. b) Fluctuates. Retention, Avoidance, and Transfer are all _________________. a) Accumulated at interest 3)Minors. d. D. Financial Experience. (c) face amount of the policy and the legal reserve. A ______ will receive unfavorable tax treatment. 4)Based on principle sum(rider) & capital sum(insurer) 50%, 3rd party ownership insurers issues policy to a lending institution c) An agent offers tickets to a baseball game as an inducement to buy insurance. The Human Life Value Approach to determining the value of an individual's life requires the calculation of probable future earnings of the insured, which involves wages, expenses, inflation, amount of time until retirement, and the time value of money. What type of interest does universal life have? A false statement in the application for insurance is_____________. Quarterly working capital levels for your firm for the next year are included in the following table. An Insurance Broker is responsible for what? A monthly deduction is made from a policy's cash value for the cost of insurance protection. The applicant has been shown to be a poor personal credit risk. A key person insurance policy can pay for which of the following? An agent tells an insured that if he replaces his current insurance policy with a newer one, his dividends will be higher and his premium will be slightly lower. Which $50,000 life insurance contract if purchased when the insured was 32, would have the highest cash value when the insured is 50? C. Tax Status Prepare a pie chart of on-time delivery performance for last month. All of the following are personal uses of life insurance EXCEPT, All of the following are true of key person insurance except, D. The plan is funded by permanent insurance only. Age, Sex, Occupation, Hobbies, Habits, Smoking or Non-Drug user or Non. How has the Aswan High Dam affected the lives of Egyptians? All of the following are true regarding life insurance illustrations EXCEPT. This form of life insurance has fixed premiums and the cash value is not guaranteed. True or False: Under the Financial Responsibility Law, you are required to have insurance on any motor vehicle you own or drive, except motorcycles & &&\textbf{ Quarter } \\ B) The parent is responsible for the premium. a) No penalties, since the owner is older than 59 2)FCRA(fair credit reporting act) checks MIB report. What limitations might this model have for predicting consumer's attitudes and purchase behavior towards Cream Silk? Life insurance prodceeds -age 100. 4)Consumer report=credit, -shorter time span for paying premiums 3) type of plan they applied for. Upon policy delivery, the producer may be required to obtain any of the following EXCEPT Consumer report ~~~\text{Indirect labor cost}&28,000\\ \text { Type I } & \$ 30 & \$ 35 & - \\ \end{array} D) Obtaining a bachelor's degree. Correct: A Insurance . Correct: D. A surplus lines broker places risks with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers. Why do most states have a waiting period for couples applying for marriage licenses? 3)Increasing term adds face value. Which of the following is a physical hazard? II. Tom and Nancy Boyle provide financial support for their two children. 2)interest sensitive On DUE DATE. C) An insurance contract must contain a copy of the original application. Any gain in the policy's cash value is . D) real estate, Under one method of estimating a loss reserve, the reserve is based on life expectancy, duration of disability, and similar factors. 2)quarterly 3) Retaining the risk. Rates 1)absolute assignment-all rights are assigned What is the primary source of info for the underwriting department to determine insurability? 4)Explain the policy and its provisions &\text { Cash }\\ a) To limit the insurer's liability after the 2 year waiting period (Choose from the following options) When a policy has reached its final destination and can be paid out in full is when the policy has ____________? Which of the following is the best reason to purchase life insurance rather than annuities? A SEC registration. &\begin{array}{l|lr} If the corporation collects the policy benefit, then \hline & \text { Jul 1 } & \begin{array}{r} A. c. Credit life If the conversion cost is the same for both types of rooms, would you recommend converting the office to a Type I or a Type II room? It is legal to list nonguaranteed values in the contract, but they must be specifically labeled as projected, not guaranteed values. -also the agent may be required to initial the change, statement of health from insureds personal physician, What are 2 federal laws that protect policy holders & forms that must be completed? c) Variable Premium 5)Survivorship Life Policy (policy holder pays themselves). b. Which of the following is an example of an unfair claims settlement practice? A. C. Loss of personal income a) Lump-sum approach A life insurance policy is exchanged for an annuity. 2) Transferring the risk Reinsurer Assuming company. C. Conditional contract B. a sheet where the agent lists any additional info about insured including: habits,financial status, or anything that may be important for the underwriting department to determine the risk involved. Study with Quizlet and memorize flashcards containing terms like Which of the following would not appear in the asset section of an insurance company's balance sheet? Costs of training a replacement b) The debtors eligible for insurance under the policy shall all be the debtors of the creditor(s).
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