Alabama State Insurance Exam FX Practice Questions and Answers
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Course
Alabama Insurance
Institution
Alabama Insurance
Alabama State Insurance Exam FX Practice
Questions and Answers
If a producer changes his residential address who must he/she notify? -
Answer️️ -This change will need to be reported to the Commissioner.
Which of the following is NOT true regarding minors purchasing
insurance policies in th...
Alabama State Insurance Exam FX Practice
Questions and Answers
If a producer changes his residential address who must he/she notify? -
Answer✔️✔️-This change will need to be reported to the Commissioner.
Which of the following is NOT true regarding minors purchasing
insurance policies in this state? - Answer✔️✔️-Minors at the age of 14 are
allowed to buy their own policies.
What is the penalty for IRA distributions that are below the required
minimum for the year? - Answer✔️✔️-50%
All of the following are business uses of life insurance EXCEPT -
Answer✔️✔️-Funding against general company financial loss.
Which of the following is called a "second-to-die" policy? - Answer✔️✔️-
Survivorship life
The term "fiduciary capacity" deals with a producer's - Answer✔️✔️-Position
of financial trust.
Which is NOT true about beneficiary designations? - Answer✔️✔️-The
beneficiary must have insurable interest in the insured.
An IRA purchased by a small employer to cover employees is known as a -
Answer✔️✔️-
All of the following applicants for an insurance producer license are
exempt from prelicensing education requirements EXCEPT - Answer✔️✔️-
An applicant for a dealer's license.
An agent accepts the premium payment 35 days after it is due, telling the
insured that there will not be a problem keeping the policy in force. This is
an example of what type of agent authority? - Answer✔️✔️-apparant
Which of the following determines the length of time that benefits will be
received under the Fixed-Amount settlement option? - Answer✔️✔️-Size of
each installment
What is a major problem with naming a trust as the beneficiary of a life
insurance policy? - Answer✔️✔️-They are expensive to administer.
Contracts that are prepared by one party and submitted to the other party
on a take-it-or-leave-it basis are classified as - Answer✔️✔️-Contracts of
adhesion.
All of the following statements concerning the use of life insurance as an
Executive Bonus are correct EXCEPT - Answer✔️✔️-The policy is owned by
the company.
Which of the following is considered to be a morale hazard? - Answer✔️✔️-
Driving recklessly
When transacting business in this state an insurer formed under the laws of
another country is known as a/an - Answer✔️✔️-Alien Insurer
When a reduced-paid up nonforfeiture option is chosen, what happens to
the face amount of the policy? - Answer✔️✔️-It is reduced to the amount of
what the cash value would buy as a single premium.
The policyowner wants to make sure that upon his death, the life policy
will pay a portion of the proceeds annually to his spouse, but that the
principal will be paid to their children when they reach a certain age.
Which settlement option should the policyowner choose? - Answer✔️✔️-
Interest only option
Under which nonforfeiture option does the company pay the surrender
value and have no further obligations to the policyowner? - Answer✔️✔️-
Cash surrender
An insured has a Modified Endowment Contract. He wants to withdraw
some money in order to pay medical bills. Which of the following is true? -
Answer✔️✔️-He will have to pay a penalty if he is younger than 59½.
When would a misrepresentation on the insurance application be
considered fraud? - Answer✔️✔️-If it is intentional and material
In Alabama, an insurance company certificate of authority is issued for
what period of time? - Answer✔️✔️-Perpetual
If an application for an annuity is gathered any way other than face-to-face,
within how many days after the insurer receives the completed application
must the applicant be given a Buyer's Guide? - Answer✔️✔️-5 business days
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