An IRA purchased by a small employer to cover employees is known as a - Answer- simplified employee pension plan
The primary beneficiary of her husband's life policy found that no settlement option was stated in the policy on the date of her husband's death. Who will select the settlement option...
Primerica Exam Review
An IRA purchased by a small employer to cover employees is known as a - Answer- simplified employee pension plan
The primary beneficiary of her husband's life policy found that no settlement option was stated in the policy on the date of her husband's death. Who will select the settlement option in this case? - Answer- The beneficiary
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period time is known as the - Answer- Incontestability clause
The type of policy that can be changed from one that does not accumulate cash value to the one that does is a - Answer- convertible term policy
Which of the following types of risk will result in the highest premium? - Answer- substandard risk
An individual has just borrowed $10,000 from his bank on a 5 year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation? - Answer- decreasing term
Which of the following explains the Policyowner's right to change beneficiaries choose options and receive proceeds of a policy? - Answer- owners right
Which nonforfeiture option provides coverage for the longest period of time? - Answer- Reduced paid up
Insurance policies are not drawn up through negotiations and an insured has little to say
about its provisions. What contract characteristic does this describe? - Answer- Adhesion
Which of the following is correct concerning the taxation of premiums in a key person life insurance policy? - Answer- premiums are not tax deductible as a business expense
To sell variable life insurance policies, an agent must receive all of the following EXCEPT - Answer- Sec registration
Which universal life option has a gradually increasing cash value and a level death benefit? - Answer- Option A
If $100,000 of life insurance proceeds were used in a settlement option, which paid $13,000 per year for ten years, which of the following would be taxable annually? - Answer- $3,000 A tax sheltered annuity is a special tax favored retirement plan available to - Answer- certain group of employees only
When is the earliest a policy may go into effect? - Answer- When the application is signed and a check is given to the agent
Which of the following is NOT the consideration in a policy? - Answer- The application given to a prospective insured
All of the following are true about variable products except - Answer- The premiums are invested in the insurer's general account
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it? - Answer- Limited pay life
When the insured selects the extended term nonforfeiture option, the cash value will be used to purchase term insurance with what face amount? - Answer- Equal to the original policy for as long as the cash values will purchase
What is the purpose of a conditional receipt? - Answer- It is intended to provide coverage on a date earlier than the date of the issuance of the policy.
When a whole policy lapses or is surrendered prior to maturity the cash value can be used to - Answer- purchase a single premium policy for a reduced face amount
If the annuitant dies during the accumulation period, who will receive the annuity benefits? - Answer- the beneficiary
If only one party to an insurance contract has made a legally enforceable promise what kind of contract is it? - Answer- unilateral
The insured had his wife named as the beneficiary of his life insurance policy. To ensure that his wife had income for life after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking into account all of the following EXCEPT - Answer- The insured's age at death
Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client? - Answer- limited pay whole life
Which of the following is NOT true regarding the annuitant? - Answer- The annuitant cannot be the same person as the annuity owner
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