WV State Life Insurance Exam Study Questions and Answers Top Graded Graded A

A group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a: - Risk retention group Which of the following requires insurers to disclose when an applicant's consumer or credit history is being investigated? - 1970-Fair Credit Reporting Act Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features? - Aleatory The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy future obligations to its policyholders is called: - Reserves All of the following are considered to be typical characteristics describing the nature of an insurance contract, EXCEPT: - Bilateral What year was the McCarran-Ferguson Act enacted? - 1945 Which of the following consists of an offer, acceptance, and consideration? - Contract Who elects the governing body of a mutual insurance company? - Policyholders Insurance policies are considered aleatory contracts because: - Performance is conditioned upon a future occurrence Who makes the legally enforceable promises in a unilateral contract? - Insurance company Insurance contracts are known as _____ because certain future conditions or acts must occur before any claims can be paid. - Conditional A life insurance arrangement which circumvents insurable interest statutes is called: - Investor-Originated Life Insurance In an insurance contract, the insurer is the only party who makes a legally enforceable promise. What kind of contract is this? - Unilateral When third-party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have: - Insurable interest in the proposed insured Which of these arrangements allows one to bypass insurable interest laws? - Investor-Originated Life Insurance When must insurable interest exist for a life insurance contract to be valid? - Inception of the contract If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of? - Insured Which of these is an element of a Variable Life policy? - A fixed, level premium A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision? - Payor provision Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies? - Policyowner Which of the following actions is NOT possible with a Universal Life policy? - Premiums may be applied as a credit against income tax Which of the following policies is characterized by a flexible premium and death benefit and allows the policy owner control of the investment aspect of the plan? - Variable universal life A term life insurance policy matures: - upon the insured's death during the term of the policy What type of life policy covers two people and pays upon the death of the last insured? - Survivorship When is the face amount paid under a Joint Life and Survivor policy? - Upon the death of the last insured Variable Whole Life Insurance can be described as: - Both an insurance and securities product All of these characteristics of an Adjustable Life policy, EXCEPT: - Face amount can be adjusted using policy dividends Term insurance has which of the following characteristics? - Expires at the end of the policy period