Kentucky Life Focused Review (2nd)
All of the following are characteristics of a group life insurance plan EXCEPT - Answer-There is a
requirement to prove insurability on the part of the participants.
There is no individual underwriting for group life insurance.
Unlike the traditional whole life policy, a variable whole life policy does NOT guarantee the - Answer-
Cash value
In a variable whole life policy, the cash value is not guaranteed and fluctuates with the performance of
the portfolio in which the premiums have been invested by the insurer.
Which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the
insured, and to whom the benefits will be paid? - Answer-Insuring clause.
The insuring clause states that the insurer agrees to provide life insurance for the named insured which
will be paid to a designated beneficiary when proof of loss is received by the insurer.
Which of the following would NOT fall into the category of costs associated with death? - Answer-The
expense of a vacation for surviving family members
, These costs would take into account the final medical expenses of the insured, funeral expenses, and
day to day expenses of maintaining the family including rent or mortgage payments, car payments,
utilities, groceries, etc.
Which of the following is an example of a producer being involved in an unfair trade practice of
rebating? - Answer-Telling a client that his first premium will be waived if he purchased the insurance
policy today
Rebating is defined as offering any inducement in the sale of insurance products that is not specified in
the policy, including money, reductions in commissions, promises, and personal services. Both the offer
and acceptance of a rebate are illegal.
Which of the following would be the most likely to start a tax-sheltered annuity. - Answer-Public school
teachers
A tax-sheltered annuity is a special tax-favored retirement plan available only to certain groups of
employees: public education (Teachers), nonprofit charitable org., religious and other 501c(3)
organizations.
All of the following are general requirements of a qualified plan EXCEPT - Answer-The plan must be
temporary.
QUALIFIED PLANS MUST BE PERMANENT
If $100k of life insurance proceeds were used in a settlement option that paid $13k/yr for a 10 years,
which of the following would be taxable annually? - Answer-$3k
$10k/yr would be income tax free (as principle) and $3k/yr would be income taxable (as interest)
All of the following are characteristics of a group life insurance plan EXCEPT - Answer-There is a
requirement to prove insurability on the part of the participants.
There is no individual underwriting for group life insurance.
Unlike the traditional whole life policy, a variable whole life policy does NOT guarantee the - Answer-
Cash value
In a variable whole life policy, the cash value is not guaranteed and fluctuates with the performance of
the portfolio in which the premiums have been invested by the insurer.
Which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the
insured, and to whom the benefits will be paid? - Answer-Insuring clause.
The insuring clause states that the insurer agrees to provide life insurance for the named insured which
will be paid to a designated beneficiary when proof of loss is received by the insurer.
Which of the following would NOT fall into the category of costs associated with death? - Answer-The
expense of a vacation for surviving family members
, These costs would take into account the final medical expenses of the insured, funeral expenses, and
day to day expenses of maintaining the family including rent or mortgage payments, car payments,
utilities, groceries, etc.
Which of the following is an example of a producer being involved in an unfair trade practice of
rebating? - Answer-Telling a client that his first premium will be waived if he purchased the insurance
policy today
Rebating is defined as offering any inducement in the sale of insurance products that is not specified in
the policy, including money, reductions in commissions, promises, and personal services. Both the offer
and acceptance of a rebate are illegal.
Which of the following would be the most likely to start a tax-sheltered annuity. - Answer-Public school
teachers
A tax-sheltered annuity is a special tax-favored retirement plan available only to certain groups of
employees: public education (Teachers), nonprofit charitable org., religious and other 501c(3)
organizations.
All of the following are general requirements of a qualified plan EXCEPT - Answer-The plan must be
temporary.
QUALIFIED PLANS MUST BE PERMANENT
If $100k of life insurance proceeds were used in a settlement option that paid $13k/yr for a 10 years,
which of the following would be taxable annually? - Answer-$3k
$10k/yr would be income tax free (as principle) and $3k/yr would be income taxable (as interest)
