It allows for a spouse to be added as a rider to a life insurance policy It allows for policy loans to be advanced to the insured in the event of unemployment It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill It allows for a third party to purchase a life insurance policy at a discounted rate and immediately advance a portion of the death benefit, All of these are standard exclusions found in a life insurance policy EXCEPT hazardous occupations aviation disability war, Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue? Cash surrender Extended term insurance Reduced paid-up insurance Life income annuity, Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies? there must be legal reasons for entering into the contract B) at the time of application A) there must be an offer and acceptance Events are those which cannot be controlled by either . Her son, Mike, is the beneficiary. Ken is a producer who has obtained Consumer Informations Reports under false pretenses. B) Apparent insurer The Fair Credit Reporting Acts main purpose is to, Protect consumers with guidelines regarding credit reporting and distribution, A whole life insurance policy accumulated cash value that becomes, The policy loan value which the insured may borrow against. Which of the following BEST describes a conditional insurance contract? Loans obtained by a policyowner against the cash value of a life insurance policy. Which type of life insurance offers flexible premiums, a flexible death benefit, and the choice of how the cash value will be invested? A) Make whole Returning a portion of a premium as inducement to purchase insurance, An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out. 2 See answers D) Business owner and business client, Under a contract of adhesion, fichoh. which of the following best describes a conditional insurance contract? The amount of his disability income payments for an on-the-job injury may be reduced by. Both partners are still married at the time of Bob's death. Only the insured is legally bound, According to the principle of Utmost Good Faith, the insured will answer questions on the application to the best of their knowledge and pay the required premium, while the insurer will deal fairly with the insured and it's When the principal gives the agent authority in writing, its referred to as, The terms must be accepted or rejected in full. 2. GENERAL LAW OF CONTRACTS A contract is an agreement enforceable by law. Which of the following is a reinstatement condition? C) Probability of loss Insurers must maintain files of all documents used for solicitation for ____ year(s) after the last authorizes date of use. Consideration clause B) Offer and acceptance B) Parent and children B) Indemnity Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling? Term Straight Life Endowment Variable Life, A life insurance policy that has premiums fully paid up within a stated time period is called stated payment insurance limited universal insurance stated modified insurance limited payment insurance, Reggie purchased a life insurance policy with a face amount of $500,000. issuance of the policy B) other insurance A) Parties involved must be competent Andy the annuitant dies before the annuity start date. A) when any business relationship exists D) underwriter, Reasonably necessary acts that an agent must perform for carrying out his/her expressly authorized duties are covered by an agent's Which of these features are held exclusively by variable universal life insurance? D) Intent, Which contract element is insurable interest a component of? Consideration She is receiving the death benefit in payments of $10,000 per month until the principal and interest has been paid out. (A) Both parties to the contract are bound to the terms. Answer Explanation: A contract that requires certain conditions or acts by the insured individual. C) apparent authority It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill. James is the insured on a life insurance policy where his age was misstated on the application. Bob dies 12 months later. Policy Summary Buyer's Guide Entire Contract Entire Policy, It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill, What is the purpose for having an accelerated death benefit on a life insurance policy? The insured does not meet established underwriting requirements, The type of multiple protection coverage that pays on the death of the last person is called a(n). definitions Where would policy proceeds be paid if both the insured and primary beneficiary were killed in the same accident? Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium". Which of the following policies does NOT build cash value? Nothing $100,000 $250,000 $500,000, Which type of life insurance is normally associated with a Payor Benefit rider? Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. warranty guarantee representation collateral, there must be legal reasons for entering into the contract, Legal purpose is a term used in contract law meaning there must be an offer and acceptance the contract must be aleatory there must be legal reasons for entering into the contract the contract must be a contract of adhesion, In an insurance contract, the element that shows each party is giving something of value is called offer acceptance consideration purpose, What makes an insurance policy a unilateral contract? D) Personal contract, The importance of a representation is demonstrated in what rule? producer's apparent authority A (D) Only one party is legally bound to the contract. To see this page as it is meant to appear, please enable your Javascript! $1,000 $3,000 $5,000 $7,000, A nonparticipating company is sometimes called a(n) alien insurer mutual insurer reinsurer stock insurer, Because dividends are considered to be a return of premium, Why are dividends from a mutual insurer not subject to taxation? Connect the text to your own experiences. Craig purchased a life insurance policy for enabling his heirs to pay estate taxes. D) statements made in the application only, C) statements made in the application and the premium, According to life insurance contract law, insurable interest exists be filed with the state Sharing commissions with a producer licensed in the same line of business. A) definitions warranty Death benefits Cash value Loading costs Separate account investments, Which policy feature makes a universal life policy different from a whole life policy? B) Only the insured can change the provisions The policy may be paid up early by using policy dividends. C) Bob's spouse Risk reduction Risk transference Risk avoidance Risk retention, The cause of a loss is referred to as a(n) hazard adversity peril risk, How do insurers predict the increase of individual risks? Insurance producer Jerry offers a $350 shopping card if they purchase an insurance product through him. Which of these is considered to be a Living Benefit option in a life insurance policy? Only the insured pays the premium A) insured Which Of The Following Statements About Personal Selling Is Correct? Shirley has a $500,000 10-year-non-renewable level term life policy. If the consumer price index had gone up 4%, how much may Ron increase the face value of the policy? C.$2,113 A) voidable The terms of the policy typically outline these conditions, which may include paying premiums on time and maintaining the insured property in good condition. C) statements made in the application and the premium In a life or health insurance contract, "consideration" would be the, statements made in the application and the premium, A professional liability for which producers can be sued for mistakes of putting a policy into effect is called. D) collateral, Express power given to an agent in an agency agreement is Which of the following is a requirement to attain an Utah resident producer license? A life insurance policyowner does NOT have the right to, Fixed annuities provide each of the following EXCEPT. Which of the following products would allow him to accomplish this? (D) Only one party is legally bound to the contract. B) acceptance Sister and brother Parent and children Business partners Business owner and business client, The deeds and actions of a producer indicate what kind of authority? An applicants character and personal habits can be obtained for underwriting purposes from which source? If the insured dies at any time during the 5 years, his beneficiary will receive the policy's face value. D) conditions, The authority granted to a licensed producer is provided via the B) the contract must be aleatory D) only when determined by a judge, Xcel Chapter 3 Legal Concepts of the Insuranc, Chapter 3 Exam - Legal Concepts of the Insura, Chapter 4 Exam - Life Insurance - Types of Po, 4 - (Questions) Life Insurance Policies - Pro, Chapter 5: Life Insurance Premiums, Proceeds,, Chapter 4: Type of Insurance Policies Part 1, Chapter 4: Policy Provisions, Options and Rid, Calculus for Business, Economics, Life Sciences and Social Sciences, Karl E. Byleen, Michael R. Ziegler, Michae Ziegler, Raymond A. Barnett, Fundamentals of Engineering Economic Analysis, David Besanko, Mark Shanley, Scott Schaefer, The Cultural Landscape: An Introduction to Human Geography, AP Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Unit 7 AP Env. Apparent Adjustable life policy Modified life policy Endowment policy Universal life policy, How are survivorship life insurance policies helpful in estate planning? Because insurance premiums are tax-deductible Because dividends are already subject to capital gains Because dividends are payable directly to the policyholder Because dividends are considered to be a return of premium, A type of insurer that is owned by its policyowners is called domestic mutual stock in-house, What is considered to be the primary reason for buying life insurance? Which of these factors is NOT taken into account when determining an applicants life insurance needs? Insurance contracts are unilateral contracts. Child term rider Payor rider Family maintenance rider Family income rider, What happens to the coverage under a children's term rider when that child reaches a certain specified age?
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