South Carolina Insurance Exam Questions100% Solved 2025

An insurer is REQUIRED to offer which of the following to each long-term care applicant at the time of purchase? - Correct Ans-Inflation protection Which of these riders will pay a death benefit if the insured's spouse dies? - Correct Ans-Family term insurance rider Disability income plans which require that the insurer can NEVER change or alter premium rates are usually considered - Correct Ans-Nonconcellable What is the required action to be taken by a South Carolina licensee before operating under an assumed business name? - Correct Ans-Notify the Director The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period from the policy's inception, the insurer will only be liable for a return of premiums paid - Correct Ans-minus indebtedness and without interest If an annuitant dies before the annuity start date - Correct Ans-the premiums paid plus interest will be given to the beneficiary The purpose of the Coordination of Benefits provision in group accident and health plans is to - Correct Ans-avoid overpayment of claims The typical long-term care insurance policy is designed to provide a minimum of___year(s) of coverage - Correct Ans-1 Decreasing term life insurance is often used to - Correct Ans-provide coverage for a home mortgage Which type of life insurance policy pays the face amount at the end of the specified period if the insured is still alive? - Correct Ans-Endowment policy A life insurance policy normally contains a provision that restricts coverage in the event of death under all of the following situations EXCEPT - Correct Ans-fare-paying passenger All _____ policies must be guaranteed renewable. - Correct Ans-long-term care What type of injury would NOT be covered under a health insurance policy? - Correct Ans-Work related Insurance Insurance All of these are common exclusions to a life insurance policy EXCEPT - Correct Ans accidental health Which of the following decisions would a Health Savings Account (HSA) owner NOT be able to make? - Correct Ans-The amount contributed by the employer A whole life insurance policy accumulates cash value that becomes - Correct Ans-the policy loan value which the insured may borrow against Mike has inherited his father's traditional IRA. As beneficiary, he will pay ____ taxes on any money withdrawn. - Correct Ans-income An interest-sensitive life insurance policyowner may be able to withdraw the policy's cash value interest free. The provision that allows this is called - Correct Ans-Partial Surrender Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Which of these statements is true? - Correct Ans-The face amount and premium will remain constant over the 10-year period Kristi purchases an annuity that will pay her husband an income for 15 years. If he dies, this income will become payable to their children for the remainder of the period. Kristi has what kind of annuity? - Correct Ans-Temporary annuity certain When a qualified plan starts making payments to its recipient, which portion of the distributions is taxable? - Correct Ans-Gains Pre-death distributions from a modified endowment contract (MEC) receive different tax treatment than other life insurance policies because - Correct Ans-the MEC tends to be an investment vehicle A medical provider that accepts Medicare Assignment must - Correct Ans-accept payment based upon a defined Medicare schedule as payment in full Proof of loss on a health insurance claim must be submitted to an insurer within___days after the insured's date of loss - Correct Ans-90 The entire contract includes the actual policy and the - Correct Ans-application The factor used most often when underwriting a disability income policy is - Correct Ans-annual earnings David submits a $500 claim for medical expenses. There is a past-due amount owed for insurance premiums of $200. As a result, the insurer only pays $300 for the claim. This deduction came as a result of which provision? - Correct Ans-Unpaid provision Insurance Insurance Which of these is NOT considered to be a purpose of an annuity? - Correct Ans Annuities are intended to create an estate Which of the following is NOT a circumstance to which a temporary producer license can be issued? - Correct Ans-prospective producer who is waiting to take the state licensing examination In what form do disability income policies typically pay benefits? - Correct Ans-periodic income A renewable Term Life insurance policy allows the policyowner the right to renew the policy - Correct Ans-without producing proof of insurability Donald is the primary insured of a life insurance policy and adds a children's term rider. What is the advantage of adding this rider? - Correct Ans-Can be converted to permanent coverage without evidence of insurability A producer has committed an insurance crime that violates US Code 1033 (interstate commerce). Who would be responsible for the persecution of this crime? - Correct Ans US attorney general Under a group life policy, the insurer will issue an individual _____ to the policyowner for delivery to each person insured. - Correct Ans-certificate Frank is shopping for a disability income policy. Which of the following would have the HIGHEST premium? - Correct Ans-14 day period / 10 year benefit period XYZ Company has applied for a group health insurance for its employees. What information would the insurers underwriters likely use to determine the appropriate coverage and final premium rate given to the group? - Correct Ans-Experience rating In regards to a life insurance contract, which of the following statements is NOT true regarding the concept of insurable interest? - Correct Ans-Insurable interest can be established sufficiently by sentimental attachment alone Under a Modified Endowment Contract, what are the likely tax consequences? - Correct Ans-Pre-death distributions will become taxable Key person Disability Insurance pays benefits to the - Correct Ans-employer Sonya applied for a health insurance policy on April 1. Her agent submitted the information to the insurance company on April 6. She paid the premium on May 15 with the policy indicating the effective date being May 30. On which date would Sonya have coverage? - Correct Ans-May 30 Insurance Insurance What happens to interest earned if the annuitant dies before the payout start date? -