A) Any distributions from MECs are taxable, including withdrawals and policy loans. There are many legitimate need-based expenses that can be paid by life insurance proceeds, from groceries to retirement income. D. Funding against general company financial loss. Jul3119,500\begin{aligned} B. (b) Prepare a correct income statement for October 2017. All of the following are common characteristics of this coverage EXCEPT - Limited Pay Life It requires evidence of insurability for renewal. Nature of risk Part 1 of the application includes the general questions about the applicant, including name, age, address, birth date, gender, income, marital status, and occupation. What are the permanent working capital needs of your company? The concept that the insured should not profit from an insurance transaction is called what? C. Independent rating services evaluate and rate the financial ability of insurance companies However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. D. Effect of inflation on income over time. (2), The current market will influence the cash value -greater potential to grow the cash value but there is no guarantee \text{Net loss}&&\underline{\underline{\$(23,000)}}\\ Fraud -the premiums are paid for a limited time only. ~~~\text{Depreciation on factory equipment}&31,000\\ D. The benefit is received tax free Annually renewable term policies provide a level death benefit for a premium that 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. C. Certain Risk Universal Life is also known as two things what are they? When Applicant P fails to disclose all of his motor vehicle violations in an application for automobile insurance, he may be guilty of: A. Estopple An underwriter will consider each of the following factors when evaluating a risk, except: A. All of the following statements about the settlement of a claim are true EXCEPT. Insurance is considered a transfer of risk. A key person insurance policy will pay for costs of running the business and replacing the employee. 3) Equity-Index annuity. Warranty Empire Company is a manufacturer of smart phones. . &\begin{array}{r|lr} S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. Estimated direct labor costs for next year are$440,000.00. 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. InventoryJul1Jul3122,000???? &\begin{array}{lr|lr} a) Agent's report 1) a policyholder votes on the Board of Directors II. All of the following are types of insurers except: The ________ Branch of the state government influences public policy regarding insurance laws. \end{array} Something of value is a __________________. c) Fixed premium Statements in the application that are guaranteed true but later found to be false may result in what? -Can't lose value What is NOT invested in the stock market but pays you interest? \hline (\$ 000) & 1 & 2 & 3 & 4 \\ Which of the following is TRUE regarding assignment rights for . 1. Due to climate change, premiums are going up for certain types of insurance, such as flood insurance. Correct: C. Unilateral contract. \end{array} Company A carries 1/3 of the total coverage ($20,000 + $40,000 = $60,000). 2)the face amount (3), WHat is the difference between universal and whole life policies? Permanent Insurance have 3 words in common, what are they? Consumer report \text { Type I } & \$ 30 & \$ 35 & - \\ c) The policy will be voided. b. persistent fear of germs 1)policy owner can increase/decrease/ or skip premium payments What are two reasons that people deposit money in banks? The insured agrees to maintain insurance equal to some specified percentage of the value of the property. All of the following statements are true of liability insurance, EXCEPT: Answer: liability coverage indemnifies the insured. -tax free accumulation of borrowing. When an agent collects the initial premium from the applicant, the agent should issue the applicant a. All of the following are business uses of life insurance EXCEPT D. Concealment AccountsreceivableJul1Jul3121,000???? -usually mutual fund security Correct: D. Department of Treasury, The Terrorism Act, which protects consumers by addressing market disruptions and ensuring the continued widespread availability and affordability of property and casualty insurance for a terrorism risk, is a administered by the Department of Treasury. There is no limitation on the number of key employee plans in force at any one time. d. 10 payment whole life, Chapter 12 - Life Insurance Contractual Provi, Chapter 15 - Individual Health Insurance Cove, Fundamentals of Financial Management, Concise Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese. In this case, the applicant will most likely need to fill out a Statement of Good Health. D) When replacement is involved, a producer must perform the following duties: sign replacement notice (and keep a copy), provide a list of items being replaced, leave all brochures/sales material used in the sale, take new application, submit "Copy to Replacement" notice, and it attach to application. It is legal to list nonguaranteed values in the contract, but they must be specifically labeled as projected, not guaranteed values. ~~~\text{Direct labor cost}&190,000\\ (b) variable life insurance An Insurance broker is responsible for what? Who would be eligible to obtain SGLI? D. Breach of warranty \hline & \text { Jul 1 } & \begin{array}{r} According to the entire contract provision, what document must be made part of the insurance policy? C. Buy-Sell agreements are normally funded with a life insurance policy Correct: A Insurance . e. The total of costs recorded on all sales invoices for the month is$654,052.00. B. (d) neither I nor II. B) Human life value approach is determined by the loss of income that would result with the death of the insured, after making adjustments for expenses, inflation, etc. D. Concealment (c) face amount of the policy and the legal reserve. The agent The replacing company notifies the replacement company. The cash value available to the policyowner 4)explain policy & provisions a. mentally counting backward from 1,0001,0001,000 After insurer makes an offer, what must the applicant do? D. Premiums are tax deductible as a business expense, B. A false statement in the application for insurance is_____________. When a replacement is involved, a replacing insurance company is responsible for all of the following EXCEPT: Provide a copy of the Important Notice Regarding Replacement of Life Insurance to the applicant. C. Consideration \hline & \text { Jul 1 } & 55,000 \\ d) Limited pay. Despite this, the country has significantly worse healthcare outcomes when compared to peer nations. B. 3)2 death benefit option d) Living need rider. The gross premium charged must reflect, at least for competitive reasons, the actual cost of providing the insurance. &\text { Accounts receivable }\\ 2)Explain and collect any ratings c) Misrepresentation Copyright 2009-2022 Tests.com LLC - All Rights Reserved. Who are considered to be restricted persons concerning the formulation of an insurance contract. 3 of them? *Both not taxable. For example, a claim will be paid only is there has been a covered loss. a) Accumulated at interest a) A medical examination (b) tax-free exchange provision (a) capital retention approach -car accident not in conjunction with an illness Everything else equal, how would the factor below affect the market value of a stock? The Terrorism Risk Insurance Program is administered by which of the following Federal entities? II. Increasing term B. Which of the following about yearly renewable term insurance is true? C. group credit life insurance does not build cash values. Most agents try to collect the initial premium for submission with the application. b) 10% for early withdrawal Out of 20 yr or 30 yr which policy is less expensive? All of the following statements about term insurance are true EXCEPT. Which of the following is a financial rating service? Does T-Mobile Insurance Cover Water Damage? -immediately considered fully paid up (d) yearly renewable term, Which statement is true concerning premature death and life expectancy? 2. C. Loss of personal income What insurance concept is associated with the names Weiss and Fitch? Who represents the insured when dealing with insurance companies? See Page 1. An insurance company that was incorporated in a different state it is doing business in and pays dividends to its policyholders is known as a _________. \end{array} \\ A surplus lines broker places risk with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers Observers and analysts have attributed the reasons for the 2001-2006 housing bubble and its 2007-10 collapse in the United States to "everyone from home buyers to Wall Street, mortgage brokers to Alan Greenspan". a) the risk is transferred to the insurer b)the insured may retain part of the risk through deductibles . c. (c) face amount of the policy and the legal reserve. (b) face amount of the policy and the total premiums that have been paid. To sell variable insurance what must you have? &\begin{array}{lccc} In order for the contract or policy to be valid or legal? A policy summary Which nonforfeiture option provides coverage for the longest period of time? (a) universal life insurance. When both parties to a contract must perform certain duties in order to make the contract enforceable, this is known as what? A. 10 year level term -paying for certain time and stop. Beneficiary's age is not a suitability factor. Healthcare in the United States is far outspent than any other nation, measured both in per capita spending and as a percentage of GDP. M327. When an applicant pays the initial premium the agent will give them a what? d) Fiscal responsibility. If the insurance carried is less than required, the insurance may not cover the whole loss. What must exist at the time of the application? The requirement that producers must account for all insurance funds collected, and without the expressed consent of the insurance company(ies) are not permitted to co-mingle those funds with their own funds is known as 1)Statement of continued good health -The insurance dept. Steven prints a pamphlet to advertise his life insurance business. 2)interest sensitive They keep a high percentage of any interest earned on their policies d) Producer. A) Tax-qualified annuities are used to accumulate IRA funds on a tax-deferred basis. 4) 3 components to the premium, The owner and the insured are different people. Most policies can be renewed for additional periods without evidence of insurability. 1)increase cash value This form of life insurance has fixed premiums and the cash value is not guaranteed. A lender has an insurable interest in the life of a debtor, but only to the extent of the debt. 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? When the company earns a profit and elects to share there profits, they pay a ____________to the policyholders or shareholders. Explanation: (Life Insurance Policy Provisions, Options and Riders) A family term rider will provide term life insurance on a spouse and children. \end{array} 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 c) The premium for the policy shall be paid either from the creditor's funds, or from charges collected from the insured debtors, or from both. d) Blackout approach. Life insurance prodceeds (4), 1)monthly -Not a true insurance company Insurers use this law in order to predict certain types of losses and set appropriate premiums. (c) both I & II (d) neither I or II. A) The insurance policy usually has a provision specifying how a notice of loss is to be made to the insurance company. a) Because the insured is currently not a drug user, his policy will not be affected. See Answer. (b) Most policies can be renewed without evidence of insurability. Payor benefit/Clause is always a _________. D. The policy is a bilateral contract 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. B. Correct: A.A peril. 3)certified public accountants, Is insurance that is provided by the Federal or State government ? a) The policyholders or stockowners of the company (Hint: Take a look at the Theory of Reasoned Action.). Which model is the better fit for the data? If a parent purchases life insurance on their child all of the following are true, EXCEPT: A) The child is the insured. (c) two-income earner family. Concerning insurance, the definition of a fiduciary is Agents and producers must place business through an insurer with the lowest rated An agent has authority to do all of the following, except: A. Countersign insurance contracts All of the following are required signatures on a life insurance application EXCEPT. a) The amount of insurance on the life of any debtor may exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor. 1. C) the proposed insured. A buy-sell agreement is simply a contract that establishes what will be done with a business in the event that an owner dies. The profit per night for each type of room and rental class is as follows: RentalClassRoomSuperSaverDeluxeBusinessTypeI$30$35TypeII$20$30$40\begin{aligned} C. Domestic a) Executive offer of the replacing company c) Copy of the original application 3)Alien Insurer. Upon policy delivery, the producer may be required to obtain any of the following EXCEPT a) A retail clerk. 2)quarterly a) No penalties, since the owner is older than 59 -assignor=assignee Endowments means policy is what(2) things? C. A surplus lines broker accepts business only from non- resident agents The policy is a contract of adhesion. b) Policyholder \text{Inventory} & 201 & 505 & 905 & 52 \\ \end{array} Question: All of the following statements about variable life insurance are true EXCEPT O a. Which of the following is usually true of a participating life insurance policy? Carl would like to purchase life insurance. One sided contract is a ______________ contract. All of the following statements concerning coinsurance are true, EXCEPT . (a) renewal provision Round Trees management makes a forecast of the demand by rental class for each night in the future. Now Tamara can afford whole life insurance. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company? 4. Question: All of the following statements about professional liability insurance are true, EXCEPT: Select one: O a. D. Gender. Pure Risk. b) Failure to promptly settle a claim when liability has been clearly established 2)Foreign Insurer 2)Decreasing term(premium is low) declining face value Where does group-life insurance come from? c) Needs approach An IRA uses immediate annuities to pay out benefits; the IRA owner is nearly 75 years old when he decides to collect distributions. The policyowner can add to a policy's cash value at any time subject to policy guidelines. An agent and an applicant for a life insurance policy fill out and sign the application. C. Whole life b) State attorney general B) Once the cash surrender value option is selected, the coverage is terminated and the policy cannot be reinstated. -policyowners right provision b) Unilateral 3)Family Policy(Limited but all fam members paid) A securities license. b) To deter the policyowner from committing suicide C. Application a) Types of mutual companies Term life insurance provides pure death protection. In an insurance contract, the value that each party gives the other is called the: When an individual faces the risk of economic loss in the event of property damage, this indicates which of the following? What are the (5) Factors considered with combination policies Who and What are they? d) Fair Credit Reporting Act. -20 pay life-paid up at 65 Eight Summoning Eyes need to be placed to summon the Ender Dragon and players need to have 450 Dragon Weight to have a chance of getting the sword. Domestic Insurer 1) Competent Parties B. Correct: B. a) The policy can be converted to term coverage. Tax-qualified annuities are subject to IRA maximum contribution limits. d) Graded Premium. 2)not payable in conjunction. An insured is driving her automobile and strikes a large pothole that . What happens when a policy is surrendered for its cash value? What is used for the underwriting department to determine insurability? After Alex has made 20 premium payments, his life insurance policy is considered b. Misappropriation or illegal withholding of the policyholder's money. Numerical identifiers: Each candidate list entry covers both anhydrous and hydrated forms of a substance. the underwriting process is approved for: C. It's a decreasing term insurance. B) Fiduciary refers to a position of trust. 4)decrease premium paying period. b) Distributions before age 59 1/2 incur a 10% penalty on policy gains. A policy that does not pay dividends to policyowners is a C. Department of State How does having children affect the decisions that couples must make when considering a divorce? CPI (consumer price index) without evidence. Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. 3)2 Death benefits-(level/increasing) \hline \text { Jul 1 } & 22,000 \\ Taxes, Retirement, and Other Insurance Concep, State Laws, Rules, and Regulations Quizzes, Life Insurance Policy Provisions, Options and, Fundamentals of Financial Management, Concise Edition. 3) policy builds cash-value 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. Round Tree has 100 Type I rooms and 120 Type II rooms. What constitutes the acceptance of an offer? Prepare a pie chart of on-time delivery performance for last month. ________________ are the person who receives benefits payable upon death. Quarter($000)1234Cash$100$100$100$100AccountsReceivable1999699604Inventory20150590552AccountsPayable104959597\begin{array}{lrrrr} She meets the definition of total disability under Social Security. If a change in the application is necessary what is required? The total of all requisitions of direct materials issued during the month is $252,230.00. -Staged intervals The insurer issues the policy and learns of his history one year later. Past-due interest on a policy loan is added to the total debt. & &&\textbf{ Quarter } \\ B. Misrepresentation An individual applies for a life policy. -ages 25,28,34,37,40 Originating policy Accelerated Living Benefit/Accelerated Death Benefit? Who appoints the state insurance regulator in many states? Who assumes control over an insurance company's funds and management if it becomes insolvent? (a) I only (b) II only &\begin{array}{cr|} (b) II only Costs of training a replacement D. Aleatory contract B. Buy-Sell Agreements pay in the event of a medical emergency The following are all true regarding risk management, except: A. 2)Procures insurance 4 itself from another insurer, The tax benefit of annuities is tax deferred growth. (d) Its use may be appropriate if a person wants paid-up life insurance by retirement. C) Completing pre-licensing training. 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. c) Coverage ends but the policy can be reinstated at any time. B. Beneficiarys age \end{aligned} C. Countersign insurance contracts ? The County is administered by a five-member Board of Supervisors who are elected for four-year terms 2)Decreasing Term Insurance companies can charge an interest rate based on the policyowner's credit report. d) Accumulations are tax deferred. I. c) Denying coverage after a reasonable investigation has been conducted C. Insured's annual expenses the application is used at the primary source of info. Liquidity in life insurance refers to availability of cash to the insured. All of the following are restricted persons concerning the formulation of an insurance contract except: A producer has __________ authority when he accepts premium on a lapsed policy, and the insurer reinstates the policy. D) When immediate annuities are used to pay IRA benefits, distributions must begin no later than age 70 in order for the annuitant to avoid penalties. d) Military personnel. Journalize the entry to transfer the total of all cost sheets completed from Work in Process to Finished Goods. An agent told Carl about a form of life insurance in which Carl could select where the savings component is invested. 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 To be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. Life insurance is unique from other types of insurance in that it could perform the function of cash accumulation. Receipt Newborns after how many days become covered in a child rider? 1)Domestic Insurer The following are all true regarding risk management, except: A. D. Speculative Risk (a) limited-payment whole life insurance b) Fluctuates. (a) Interest is credited monthly to a policy's cash value. A. Appoint a solicitor as his or her representative \hline & \text { Jul 31 } & 19,500 5)coverage begins \hline \text { Jul 31 } & 25,500 1) coverage is permanent cheating. 2) Binding Reciept. If company pays dividends, then they are a? Which of the following would least likely be considered a legitimate need that would be paid by insurance proceeds? Should a key person die, the benefit is treated as a reimbursement to the business for loss of services from that key person. a) Indeterminate Premium Correct: C. Concealment, A. b) Adjustable life d) Tax-deductible. 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. True or False: Under the Financial Responsibility Law, you are required to have insurance on any motor vehicle you own or drive, except motorcycles \hline && \text { Jul 1 } & 65,000 \\ *The insured is diagnosed with terminal & chronicle illness 4) Joint-Life policy(business part) Insurance policy of 2 or more &\text { Rental Class }\\ (d) Premiums increase at an increasing rate upon renewal. All of the following statements about term insurance are true EXCEPT. C. Medical Background If the premium was not collected at the time of the application, the producer may also be required to get a Statement of Good Health from the applicant at the time of policy delivery. (Choose from the following options) C. Application d) Paid-up option. a) Aleatory Daycare is considered to be among these expenses. Which term describes the probability of a loss? O b. 2)explain any ratings \text { Room } & \text { Super Saver } & \text { Deluxe } & \text { Business } \\ Alex, age 26, purchased a 20- payment whole life insurance policy. Contract of adhesion good health B. There is no limitation on the number of key employee plans in force at any one time B. 6)Explain Free Look period-10-30 days- unconditional refund that begins when policy is delivered. C) Annually renewable term policies provide a level death benefit for a premium that increases each year with the age of the insured. \hline & \text { Jul 31 } & 58,000 -insured can stop paying premiums at certain age or after a period of time All of the following information about a customer must be used in determining annuity suitability EXCEPT D. A surplus lines broker deals with admitted carriers only Any gain in the policy's cash value is . ~~~\text{Selling and administrative salaries}&75,000\\ Traditional insurance policies contain a list or description of excluded "perils" (that which causes a loss). ~~~\text{Depreciation on sales equipment}&45,000\\ -cash value can lose value. b) Universal Life c) Conditional _____________ is an employer paid disability and health insurance coverage that covers job related illnesses or injuries. The US is the only developed nation without a system of universal healthcare, with a large proportion of its population not carrying health insurance, a . Other factors that are named include "Mortgage underwriters, investment banks, rating agencies, and investors", "low mortgage interest rates, low short-term interest rates . -They provide coverage for risks that other insurers normally would not provide. The insurance provides protection for a specified period of time. Quarterly working capital levels for your firm for the next year are included in the following table. Therefore, it is responsible for 1/3 of the $24,000 loss, or $8,000. Hospital bills of the key employee D) real estate, Under one method of estimating a loss reserve, the reserve is based on life expectancy, duration of disability, and similar factors. C. Concealment 3. If you don't have health insurance, you pay all costs for healthcare and medical emergencies. D) Members of the uniformed forces can obtain term group life insurance through Servicemembers' Group Life Insurance (SGLI). _______ pays dividends to the stock holder. Which of the following is the best reason to purchase life insurance rather than annuities? (c) conversion provision A. Insurance transfers risk but it does not__________ risk. Which of the following is true regarding the beneficiary designation of the former spouse. &\begin{array}{lr|rr} (c) both I & II (d) neither I or II, Diane is a single parent. A) the agent. Which of the following is NOT a fraudulent and intentional deception of the truth? b. (a) Evidence of insurability is not required to renew the coverage. 3)they provide insurance to members. * 50% is paid b) Larger. 4)Explain the policy and its provisions Which of the following statements about universal life insurance is true? Correct: B. It is the specific cause of loss. A. a) Consumer Privacy Act All of the following statements about ordinary life insurance are true EXCEPT. -But pays you interest, 1)Fixed annuity d) To protect the insurer from persons who purchase life insurance with the intention of committing suicide. (c) term insurance Why do most states have a waiting period for couples applying for marriage licenses? &\text { Accumulated depr.-equipment }\\

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