Life producer exam

Over the course of one year, which premium payment mode is most expensive? - answer-Monthly Who is responsible for assembling the policy forms for insureds? - answer-Insurance carriers All of these are valid policy dividend options for a life insurance policy owner EXCEPT - answer-accumulate without interest What is the primary feature of a viatical settlement? - answer-Reduced death benefit prepayment Converting a group plan to permanent life insurance requires - answer-the conversion being applied for within 31 days of termination What is involved when a life insurance policy has been backdated? - answer-Making the policy effective on an earlier date than the present Dana is an employee who deposits a percentage of her income into her individual annuity. Her company also contributes a percentage into a separate company pension plan. What kind of annuity is this considered? - answer-Qualified retirement annuity Within how many days must a Traditional IRA be rolled over to another IRA in order to avoid tax consequences? - answer-60 days How are contributions made to a Roth IRA handled for tax purposes? - answer-not tax deductible A Life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called - answer-Universal Life Which one of these is NOT considered to be a common life insurance nonforfeiture option? - answer-Life income annuity Advertising records are subject to examination by the Arkansas insurance department & must be maintained for at least: - answer-4 years or until next regular examination by the Department, whichever is longer. Loans obtained by a policyowner against the cash value of a life insurance policy - answer-would not be treated as taxable income What type of annuity guarantees a stated number of income payments, whether or not the annuitant is still alive to receive them? - answer-Life annuity certain Rob has a benefit at work which enables him to defer his current receipt of income and have it paid at a later date, when he will probably be in a lower tax bracket. Which benefit fits this description? - answer-Deferred compensation option Which of the following is NOT considered an act of fraud? - answer-Collecting a charge for insurance that is less than the charge applicable to that insurance A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is a(n) - answer-Guaranteed insurability rider A limited payment whole life policy provides - answer-lifetime protection The Commissioner must examine the financial affairs of each admitted insurer operating in Arkansas at least once every how many years? - answer-5 years Sharon is the policyowner of a $50,000 life insurance policy. Her son, Mike, is the beneficiary. If Sharon MUST obtain Mike's signature in order to change the beneficiary, what kind of beneficiary designation is this? - answer-irrevocable Insurance premium is determined by each of the following factors EXCEPT - answer-liquidity Within how many days must a rollover be completed in order to avoid being taxed as current income? - answer-60 days A provision in a whole life policy that allows a policyowner to terminate the policy in return for a reduced paid-up policy of the same type is called a(n) - answer-nonforfeiture provision A tax-free Section 1035 Exchange of a life insurance policy to a different policy is permitted if it occurs - answer-from insurer to insurer and no cash is received by the policyowner if an agent knows or suspects a fraudulent transaction, they MUST report it to the commissioner within - answer-30 days Dorian exercised a nonforfeiture option by using his life policy's cash value to purchase an extended term insurance option. When the term insurance expires - answer-the protection ends A insurance producer MUST notify the Commissioner of a change in legal name, email, or address: - answer-Within 30 days of the change All of these are valid options for an Adjustable Life Policy EXCEPT - answer-A nonforfeiture option can be used to increase the death benefit An applicant's character and personal habits can be obtained for underwriting purposes from which source? - answer-Investigative consumer report What is the purpose of the Arkansas Life and Health Insurance Guaranty Association? - answer-Protects policy owners against insolvent insurance companies Which of these is considered to be a Living Benefit option in a life insurance policy? - answer-Accelerated death benefit Which situation accurately describes a reduced paid-up nonforfeiture option? - answer-Policy has a decreased face amount Which of these is considered a major tax advantage of life insurance? - answer-Income tax is typically not owed on proceeds paid directly to a beneficiary Which policy feature makes a universal life policy different from a whole life policy? - answer-A flexible premium schedule Which of the following are the premium payments for a universal life policy NOT used for? - answer-Separate account investments Which approach predicts a person's earning potential & determines how much of that amount would be devoted to dependents? - answer-Human life value approach Over the course of a year, which premium payment mode is most expensive? - answer-monthly Who is responsible for assembling the policy forms for insureds? - answer-Insurance carriers A non-contributory health insurance plan helps the insurer avoid - answer-adverse selection Which of these is NOT a characteristic of the Accelerated Death Benefit option? - answer-The benefit can be offered as a rider at a specific extra cost or may be at no cost The taxable portion of each annuity payment is calculated using which method? - answer-Exclusion ratio The standard grace period for a life insurance policy sold in Arkansas is: - answer-31 days Who receive the benefits from a Credit Life or Disability policy? - answer-Creditor A Modified Endowment Contract (MEC) is best described as - answer-A life insurance contract which accumulates cash values higher than the IRS will allow Which of the following provisions is NOT required to be included in life insurance polices sold in Arkansas? - answer-Extended term What is an insurer required to do when faced with an error made under the Misstatement of age provision? - answer-Pay age-corrected benefits What is a corridor in relation to a Universal Life insurance policy? - answer-The gap between the total death benefit and the policy's cash value All of these are common exclusions to a life insurance policy EXCEPT - answer-accidental death The type of policy which pays on the death of the last person is called - answer-survivorship life A change in an insurance application requires - answer-an initial made by the applicant Which of these factors would an insurer consider when determining whether to accept a group life plan? - answer-average age A life insurance claim which involves a per capita distribution of policy proceeds would be payable to the - answer-named living primary beneficiaries Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life policy covering all three of their lives. If Mike dies first, the policy proceeds - answer-will no longer provide insurance protection An annuitant dies during the distribution period. What kind of annuity will return to a beneficiary the difference between the annuity value and the income payments already made? - answer-Refund annuity Morality is calculated by using a large risk pool of - answer-people and time