Comprehensive Exam-KY Life & Health
All of the following are producer responsibilities to the applicant, except: - Answer-Offering and selling
only the lowest premium policy
___________ manufacture and sell insurance coverage in the form of policies or contracts of insurance.
- Answer-Insurers
When both parties must perform certain duties and follow certain rules of conduct to make a contract
enforceable refers to a(n) __________ contract. - Answer-Conditional
_____________ insurance allows for insurance coverage to be obtained when not available from
admitted carriers. - Answer-Surplus lines
The field underwriter is the _________ and is not a determiner of insurability. - Answer-Producer
To address adverse selection what can an insurer legally do? - Answer-Establish and enforce sound
underwriting practices
A contract that is drafted by an insurer and receives no input or alteration from the insured, is
considered a(n): - Answer-Contract of Adhesion
,Which of the following parties does not sign an application for life insurance? - Answer-The beneficiary
The ____________ market is a private source of coverage of last resort for individuals or businesses that
have been rejected by voluntary market insurers. - Answer-Residual
Which of the following is NOT considered one of the essential elements of a contract? - Answer-
Conditions
An insurer NOT authorized to do business within this state is considered what type of insurer? - Answer-
Non-Admitted
Which of the following describes Fiduciary Responsibilities? - Answer-Anyone acting as an insurance
producer or agent for an insurer shall be held responsible in a trust or fiduciary capacity for any money
collected or received for the insurer
The relationship of a person who acts on behalf of a company whereby the person's actions can bind the
company is known as: - Answer-The law of agency
With health and life insurance a/an _________ is required at the time of the application. - Answer-
Insurable interest
_____________ consists of groups of underwriters called syndicates, each of which specializes in
insuring a particular type of risk. - Answer-Lloyds of London
What is the primary reason why States have 'outlawed' Stranger Originated Life Insurance (STOLI)
transactions? - Answer-At policy inception there is a lack of insurable interest
Which of the following types of policies is eligible for policy dividends? - Answer-Participating
, An applicant for life insurance pays the agent the initial premium and receives a Conditional Insurability
Receipt in return. If the policy was to be issued as substandard, but the applicant dies prior to policy
issue what is the result? - Answer-The insurer will refund any premiums paid
Which of the following best describes 'Capital Retention/Conservation' in an effort to meet an income
objective? - Answer-Investment earnings are paid out
If a copy of the application, which led to a life insurance policy being issued, is attached to the policy: -
Answer-It is considered part of the entire contract
Which of the following products are offered by insurers to protect families from the financial setback of
a family member's premature death? - Answer-Life Insurance
The HIV Consent Form specifies which types of individuals may receive __________. - Answer-The test
results
Confidential information shared by the producer to the insurer and does not become part of the policy is
the __________. - Answer-Agent's Report
A is the insured under a $100,000 10 year term life insurance policy with her spouse named as her
beneficiary. If she dies in year 9, what will her spouse receive? - Answer-The face amount of the policy
Which of the following statements about Equity Indexed Life insurance is TRUE? - Answer-The interest
credited to the policy is based off of the performance of a stock market index like the S&P 500
A policyowner would like more coverage than the $100,000 Whole Life policy being proposed, but does
not have enough discretionary income to pay a lot more money to do so. What can a producer
recommend that will allow the policyowner to have the Whole Life policy, but with more total death
benefit at an affordable price? - Answer-Add a term rider
All of the following are producer responsibilities to the applicant, except: - Answer-Offering and selling
only the lowest premium policy
___________ manufacture and sell insurance coverage in the form of policies or contracts of insurance.
- Answer-Insurers
When both parties must perform certain duties and follow certain rules of conduct to make a contract
enforceable refers to a(n) __________ contract. - Answer-Conditional
_____________ insurance allows for insurance coverage to be obtained when not available from
admitted carriers. - Answer-Surplus lines
The field underwriter is the _________ and is not a determiner of insurability. - Answer-Producer
To address adverse selection what can an insurer legally do? - Answer-Establish and enforce sound
underwriting practices
A contract that is drafted by an insurer and receives no input or alteration from the insured, is
considered a(n): - Answer-Contract of Adhesion
,Which of the following parties does not sign an application for life insurance? - Answer-The beneficiary
The ____________ market is a private source of coverage of last resort for individuals or businesses that
have been rejected by voluntary market insurers. - Answer-Residual
Which of the following is NOT considered one of the essential elements of a contract? - Answer-
Conditions
An insurer NOT authorized to do business within this state is considered what type of insurer? - Answer-
Non-Admitted
Which of the following describes Fiduciary Responsibilities? - Answer-Anyone acting as an insurance
producer or agent for an insurer shall be held responsible in a trust or fiduciary capacity for any money
collected or received for the insurer
The relationship of a person who acts on behalf of a company whereby the person's actions can bind the
company is known as: - Answer-The law of agency
With health and life insurance a/an _________ is required at the time of the application. - Answer-
Insurable interest
_____________ consists of groups of underwriters called syndicates, each of which specializes in
insuring a particular type of risk. - Answer-Lloyds of London
What is the primary reason why States have 'outlawed' Stranger Originated Life Insurance (STOLI)
transactions? - Answer-At policy inception there is a lack of insurable interest
Which of the following types of policies is eligible for policy dividends? - Answer-Participating
, An applicant for life insurance pays the agent the initial premium and receives a Conditional Insurability
Receipt in return. If the policy was to be issued as substandard, but the applicant dies prior to policy
issue what is the result? - Answer-The insurer will refund any premiums paid
Which of the following best describes 'Capital Retention/Conservation' in an effort to meet an income
objective? - Answer-Investment earnings are paid out
If a copy of the application, which led to a life insurance policy being issued, is attached to the policy: -
Answer-It is considered part of the entire contract
Which of the following products are offered by insurers to protect families from the financial setback of
a family member's premature death? - Answer-Life Insurance
The HIV Consent Form specifies which types of individuals may receive __________. - Answer-The test
results
Confidential information shared by the producer to the insurer and does not become part of the policy is
the __________. - Answer-Agent's Report
A is the insured under a $100,000 10 year term life insurance policy with her spouse named as her
beneficiary. If she dies in year 9, what will her spouse receive? - Answer-The face amount of the policy
Which of the following statements about Equity Indexed Life insurance is TRUE? - Answer-The interest
credited to the policy is based off of the performance of a stock market index like the S&P 500
A policyowner would like more coverage than the $100,000 Whole Life policy being proposed, but does
not have enough discretionary income to pay a lot more money to do so. What can a producer
recommend that will allow the policyowner to have the Whole Life policy, but with more total death
benefit at an affordable price? - Answer-Add a term rider
