ARKANSAS LIFE INSURANCE UPDATED EXAM SCRIPT
QUESTIONS AND ANSWERS MARKED A+
✔✔an insurer neglects to pay a legitimate claim that is covered under the terms of the
policy. which of the following insurance principles has the insurer violated? -
✔✔Consideration
✔✔if a consumer requests additional information concerning an investigative consumer
report, how long does the insurer or reporting agency have to comply? - ✔✔5 days
✔✔what is the primary source of information for insurance underwriting? -
✔✔Application
✔✔a married couple owns a permanent policy which covers both of their lives and pays
the death benefit only upon the death of the first insured. which policy is this? - ✔✔Joint
life policy
✔✔which of the following protects consumers against the circulation of inaccurate or
obsolete personal or financial information - ✔✔Fair Credit Reporting Act
✔✔which of the following best describes the MIB? - ✔✔It is a nonprofit organization that
maintains underwriting information on applicants for life and health insurance.
✔✔under the fair credit and reporting act, if the consumer challenges the accuracy of
the information contained in his or her report, the reporting agency must - ✔✔respond to
the consumer's complaint
✔✔which of the following best details the underwriting process for life insurance? -
✔✔Selection, Classification, and Rating risks
✔✔An insurer receives a report regarding a potential insured that includes the insured's
financial status, hobbies and habits. What type of a report is that? - ✔✔inspection report
✔✔a universal life insurance policy is best describes as a/an - ✔✔Annually Renewable
Term Policy with a cash value account
✔✔which of the following types of policies allows the policyowner to skip premium
payments, provided that there is enough cash value in the policy to cover the premium
amount? - ✔✔Universal life
✔✔If an annuitant dies before annuitization occurs, what will the beneficiary receive? -
✔✔Either the amount paid into the plan or the cash value of the plan, whichever is the
greater amount
, ✔✔which of the following statements is correct regarding a whole life policy? - ✔✔The
policyowner is entitled to policy loans.
✔✔which of the following would help prevent a universal life policy from lapsing? -
✔✔Target Premium
✔✔Both Universal Life and Variable Universal Life have a - ✔✔Flexible Premium
✔✔When would a 20-pay whole life policy endow? - ✔✔When the insured reaches age
100
✔✔which of the following statements is true concerning irrevocable beneficiaries? -
✔✔They can be changed only with the written consent of that beneficiary.
✔✔which is not true about beneficiary designations? - ✔✔The beneficiary must have
insurable interest in the insured.
✔✔A father owns a life insurance policy on his 15-year-old daughter. The policy
contains the optional Payor Benefit rider. If the father becomes disabled, what will
happen to the life insurance premiums? - ✔✔the insured's premiums will be waived until
she is 21
✔✔all of the following are true statements regarding the accumulation at interest options
except - ✔✔the interest is not taxable since it remains inside the insurance policy
✔✔which of the following, when attached to a permanent life insurance policy, allows
the policyowner to customize the policy to provide an additional amount of temporary
insurance on the insured, or allows amounts of temporary insurance to cover other
family members? - ✔✔term rider
✔✔which option is being utilized when the insurer accumulates dividends at interest and
then uses the accumulated dividends, plus interest, and the policy cash value to pay the
policy up early? - ✔✔paid-up option
✔✔An insured had a $10,000 term life policy. The annual premium of $200 was due on
February 1; however, the insured failed to pay the premium. He died on February 28.
How much would the beneficiary receive from the policy? - ✔✔$9,800
✔✔Which rider, when attached to a permanent life insurance policy, provides an
amount of insurance on every family member? - ✔✔family term rider
QUESTIONS AND ANSWERS MARKED A+
✔✔an insurer neglects to pay a legitimate claim that is covered under the terms of the
policy. which of the following insurance principles has the insurer violated? -
✔✔Consideration
✔✔if a consumer requests additional information concerning an investigative consumer
report, how long does the insurer or reporting agency have to comply? - ✔✔5 days
✔✔what is the primary source of information for insurance underwriting? -
✔✔Application
✔✔a married couple owns a permanent policy which covers both of their lives and pays
the death benefit only upon the death of the first insured. which policy is this? - ✔✔Joint
life policy
✔✔which of the following protects consumers against the circulation of inaccurate or
obsolete personal or financial information - ✔✔Fair Credit Reporting Act
✔✔which of the following best describes the MIB? - ✔✔It is a nonprofit organization that
maintains underwriting information on applicants for life and health insurance.
✔✔under the fair credit and reporting act, if the consumer challenges the accuracy of
the information contained in his or her report, the reporting agency must - ✔✔respond to
the consumer's complaint
✔✔which of the following best details the underwriting process for life insurance? -
✔✔Selection, Classification, and Rating risks
✔✔An insurer receives a report regarding a potential insured that includes the insured's
financial status, hobbies and habits. What type of a report is that? - ✔✔inspection report
✔✔a universal life insurance policy is best describes as a/an - ✔✔Annually Renewable
Term Policy with a cash value account
✔✔which of the following types of policies allows the policyowner to skip premium
payments, provided that there is enough cash value in the policy to cover the premium
amount? - ✔✔Universal life
✔✔If an annuitant dies before annuitization occurs, what will the beneficiary receive? -
✔✔Either the amount paid into the plan or the cash value of the plan, whichever is the
greater amount
, ✔✔which of the following statements is correct regarding a whole life policy? - ✔✔The
policyowner is entitled to policy loans.
✔✔which of the following would help prevent a universal life policy from lapsing? -
✔✔Target Premium
✔✔Both Universal Life and Variable Universal Life have a - ✔✔Flexible Premium
✔✔When would a 20-pay whole life policy endow? - ✔✔When the insured reaches age
100
✔✔which of the following statements is true concerning irrevocable beneficiaries? -
✔✔They can be changed only with the written consent of that beneficiary.
✔✔which is not true about beneficiary designations? - ✔✔The beneficiary must have
insurable interest in the insured.
✔✔A father owns a life insurance policy on his 15-year-old daughter. The policy
contains the optional Payor Benefit rider. If the father becomes disabled, what will
happen to the life insurance premiums? - ✔✔the insured's premiums will be waived until
she is 21
✔✔all of the following are true statements regarding the accumulation at interest options
except - ✔✔the interest is not taxable since it remains inside the insurance policy
✔✔which of the following, when attached to a permanent life insurance policy, allows
the policyowner to customize the policy to provide an additional amount of temporary
insurance on the insured, or allows amounts of temporary insurance to cover other
family members? - ✔✔term rider
✔✔which option is being utilized when the insurer accumulates dividends at interest and
then uses the accumulated dividends, plus interest, and the policy cash value to pay the
policy up early? - ✔✔paid-up option
✔✔An insured had a $10,000 term life policy. The annual premium of $200 was due on
February 1; however, the insured failed to pay the premium. He died on February 28.
How much would the beneficiary receive from the policy? - ✔✔$9,800
✔✔Which rider, when attached to a permanent life insurance policy, provides an
amount of insurance on every family member? - ✔✔family term rider
