WV STATE LIFE INSURANCE EXAM 2024 ACTUAL
EXAM 2 VERSIONS (VERSION A AND B) COMPLETE
QUESTIONS WITH DETAILED VERIFIED ANSWERS
(100% CORRECT ANSWERS) /ALREADY GRADED A+
A group-owned insurance company that is formed to assume and spread the
liability risks of its members is known as a: - ans -Risk retention group
A term life insurance policy matures: - ans -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? - ans -Survivorship
When is the face amount paid under a Joint Life and Survivor policy? - ans -Upon
the death of the last insured
Variable Whole Life Insurance can be described as: - ans -Both an insurance and
securities product
All of these characteristics of an Adjustable Life policy, EXCEPT: - ans -Face
amount can be adjusted using policy dividends
Term insurance has which of the following characteristics? - ans -Expires at the
end of the policy period
P is looking to purchase a life insurance policy that will pay a stated monthly
income to his beneficiaries for 20 years after he dies and a lump sum of $20,000
at the end of that 20 year period. What type of policy should P purchase? - ans -
Family Maintenance policy
Which of the following types of policies BEST identifies one in which the cash
value may fluctuate to reflect changing assumptions regarding mortality cost,
interest, and expense factors? - ans -Universal life
,A(n) ________ Life policy offers the owner investment in products such as money-
market funds, long-term bonds and equities - ans -Variable
K purchased a $10,000 Life Policy that will pay the face amount to her if she lives
to age 65, or to her beneficiary if she dies before age 65. K purchased which of the
following types of policies? - ans -Endowment at age 65
What type of life policy covers 2 lives and pays the face amount after the first one
dies? - ans -Joint life policy
A policy that becomes a Modified Endowment Contract (MEC): - ans -Will lose
many of its tax advantages
Which provision allows the policy owner to change a term life policy to a
permanent one without providing proof of good health? - ans -Conversion
Which of the following statements is CORRECT about accelerated death benefits?
- ans -Must have a terminal illness to qualify
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an
automobile accident. How much will the insurance company pay the beneficiary?
- ans -$20,000 death benefit
A potential client, age 40, would like to purchase a Whole Life policy that will
accumulate cash value at a faster rate in the early years of the policy. Which of
these statements made by the producer would be correct? - ans -20-pay life
accumulates cash value faster than straight life
Which of the following provisions guarantees that premiums will be waived if a
juvenile life policy owner becomes disabled? - ans -Payor clause
When a misrepresentation on a life insurance policy application is discovered,
what action may an insurance company take? - ans -Void the policy only if it's
discovered during the contestable period and proven to be material
, How do life insurance companies handle cases where the insured commits suicide
within the contract's stated Contestable period? - ans -Claims are denied under
the suicide clause of the policy
Which of the following statements about accumulated interest earned on
dividends from an insurance policy is TRUE? - ans -It is taxed as ordinary income
Which of the following requires insurers to disclose when an applicant's consumer
or credit history is being investigated? - ans -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? - ans -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: - ans -Reserves
All of the following are considered to be typical characteristics describing the
nature of an insurance contract, EXCEPT: - ans -Bilateral
What year was the McCarran-Ferguson Act enacted? - ans -1945
Which of the following consists of an offer, acceptance, and consideration? - ans -
Contract
Who elects the governing body of a mutual insurance company? - ans -
Policyholders
Insurance policies are considered aleatory contracts because: - ans -Performance
is conditioned upon a future occurrence
Who makes the legally enforceable promises in a unilateral contract? - ans -
Insurance company
Insurance contracts are known as _____ because certain future conditions or acts
must occur before any claims can be paid. - ans -Conditional
EXAM 2 VERSIONS (VERSION A AND B) COMPLETE
QUESTIONS WITH DETAILED VERIFIED ANSWERS
(100% CORRECT ANSWERS) /ALREADY GRADED A+
A group-owned insurance company that is formed to assume and spread the
liability risks of its members is known as a: - ans -Risk retention group
A term life insurance policy matures: - ans -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? - ans -Survivorship
When is the face amount paid under a Joint Life and Survivor policy? - ans -Upon
the death of the last insured
Variable Whole Life Insurance can be described as: - ans -Both an insurance and
securities product
All of these characteristics of an Adjustable Life policy, EXCEPT: - ans -Face
amount can be adjusted using policy dividends
Term insurance has which of the following characteristics? - ans -Expires at the
end of the policy period
P is looking to purchase a life insurance policy that will pay a stated monthly
income to his beneficiaries for 20 years after he dies and a lump sum of $20,000
at the end of that 20 year period. What type of policy should P purchase? - ans -
Family Maintenance policy
Which of the following types of policies BEST identifies one in which the cash
value may fluctuate to reflect changing assumptions regarding mortality cost,
interest, and expense factors? - ans -Universal life
,A(n) ________ Life policy offers the owner investment in products such as money-
market funds, long-term bonds and equities - ans -Variable
K purchased a $10,000 Life Policy that will pay the face amount to her if she lives
to age 65, or to her beneficiary if she dies before age 65. K purchased which of the
following types of policies? - ans -Endowment at age 65
What type of life policy covers 2 lives and pays the face amount after the first one
dies? - ans -Joint life policy
A policy that becomes a Modified Endowment Contract (MEC): - ans -Will lose
many of its tax advantages
Which provision allows the policy owner to change a term life policy to a
permanent one without providing proof of good health? - ans -Conversion
Which of the following statements is CORRECT about accelerated death benefits?
- ans -Must have a terminal illness to qualify
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an
automobile accident. How much will the insurance company pay the beneficiary?
- ans -$20,000 death benefit
A potential client, age 40, would like to purchase a Whole Life policy that will
accumulate cash value at a faster rate in the early years of the policy. Which of
these statements made by the producer would be correct? - ans -20-pay life
accumulates cash value faster than straight life
Which of the following provisions guarantees that premiums will be waived if a
juvenile life policy owner becomes disabled? - ans -Payor clause
When a misrepresentation on a life insurance policy application is discovered,
what action may an insurance company take? - ans -Void the policy only if it's
discovered during the contestable period and proven to be material
, How do life insurance companies handle cases where the insured commits suicide
within the contract's stated Contestable period? - ans -Claims are denied under
the suicide clause of the policy
Which of the following statements about accumulated interest earned on
dividends from an insurance policy is TRUE? - ans -It is taxed as ordinary income
Which of the following requires insurers to disclose when an applicant's consumer
or credit history is being investigated? - ans -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? - ans -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: - ans -Reserves
All of the following are considered to be typical characteristics describing the
nature of an insurance contract, EXCEPT: - ans -Bilateral
What year was the McCarran-Ferguson Act enacted? - ans -1945
Which of the following consists of an offer, acceptance, and consideration? - ans -
Contract
Who elects the governing body of a mutual insurance company? - ans -
Policyholders
Insurance policies are considered aleatory contracts because: - ans -Performance
is conditioned upon a future occurrence
Who makes the legally enforceable promises in a unilateral contract? - ans -
Insurance company
Insurance contracts are known as _____ because certain future conditions or acts
must occur before any claims can be paid. - ans -Conditional
