L&H EXAM 1 QUESTIONS AND ANSWERS
Only the _________ can surrender an annuity.
A
Owner
B
Annuitant
C
Insurer
D
Beneficiary - CORRECT ANSWER✅✅✅Owner
All of the following are true regarding the accelerated death benefit rider, except:
A
These benefits could be provided based on an insured qualifying as catastrophic illness, such as the need
for an organ transplant
B
These benefits could be provided based on an insured qualifying for long-term care, if unable to perform
activities of daily living
C
These benefits do not include disability income
D
Accelerated death benefits have to be repaid if the insured's health improves - CORRECT
ANSWER✅✅✅Accelerated death benefits have to be repaid if the insured's health improves
Which of the following would have the highest first-year annual premium for a 30-year-old, all other
factors being equal?
A
,Term to age 50
B
Term to age 60
C
Term to age 70
D
Term to age 40 - CORRECT ANSWER✅✅✅Term to age 70
The bank may require its borrowers to have a life insurance policy to secure a loan in the event of the
borrower's death. Which provision gives the bank proportional protection but not control of the policy?
A
Policy Loan Provision
B
Collateral Assignment
C
Consideration Clause
D
Entire Contract Clause - CORRECT ANSWER✅✅✅Collateral Assignment
Which of the following is not true about a reciprocal insurance company?
A
If funds are insufficient to pay claims, the subscribers are assessed for additional premium
B
It allows individuals and corporations to exchange insurance on one another's risks
C
Reciprocal companies may only transact liability insurance
D
, Each subscriber assumes a share of the risk of all other subscribers - CORRECT
ANSWER✅✅✅Reciprocal companies may only transact liability insurance
Small group major medical insurance policies in the state of New York:
A
Are often cancelled because of poor claims experience
B
May be written on a one-person firm, since they are defined as a small group
C
Must limit participation to employees that work at least 40 hours per week
D
Must be community-rated - CORRECT ANSWER✅✅✅Must be community-rated
To which of the following clients would a producer MOST likely recommend term life insurance?
A
George - in his second year of medical school; married with one child
B
Mary - a 26-year-old corporate lawyer with no children
C
Kathy - age 70 with two adult children, both of whom are married
D
Roger - a 62-year-old retired bachelor - CORRECT ANSWER✅✅✅George - in his second year of
medical school; married with one child
What is the correct term for intentionally withholding facts that, if disclosed, would change the insurer's
underwriting or rating decision?
A
Misrepresentation
B
Only the _________ can surrender an annuity.
A
Owner
B
Annuitant
C
Insurer
D
Beneficiary - CORRECT ANSWER✅✅✅Owner
All of the following are true regarding the accelerated death benefit rider, except:
A
These benefits could be provided based on an insured qualifying as catastrophic illness, such as the need
for an organ transplant
B
These benefits could be provided based on an insured qualifying for long-term care, if unable to perform
activities of daily living
C
These benefits do not include disability income
D
Accelerated death benefits have to be repaid if the insured's health improves - CORRECT
ANSWER✅✅✅Accelerated death benefits have to be repaid if the insured's health improves
Which of the following would have the highest first-year annual premium for a 30-year-old, all other
factors being equal?
A
,Term to age 50
B
Term to age 60
C
Term to age 70
D
Term to age 40 - CORRECT ANSWER✅✅✅Term to age 70
The bank may require its borrowers to have a life insurance policy to secure a loan in the event of the
borrower's death. Which provision gives the bank proportional protection but not control of the policy?
A
Policy Loan Provision
B
Collateral Assignment
C
Consideration Clause
D
Entire Contract Clause - CORRECT ANSWER✅✅✅Collateral Assignment
Which of the following is not true about a reciprocal insurance company?
A
If funds are insufficient to pay claims, the subscribers are assessed for additional premium
B
It allows individuals and corporations to exchange insurance on one another's risks
C
Reciprocal companies may only transact liability insurance
D
, Each subscriber assumes a share of the risk of all other subscribers - CORRECT
ANSWER✅✅✅Reciprocal companies may only transact liability insurance
Small group major medical insurance policies in the state of New York:
A
Are often cancelled because of poor claims experience
B
May be written on a one-person firm, since they are defined as a small group
C
Must limit participation to employees that work at least 40 hours per week
D
Must be community-rated - CORRECT ANSWER✅✅✅Must be community-rated
To which of the following clients would a producer MOST likely recommend term life insurance?
A
George - in his second year of medical school; married with one child
B
Mary - a 26-year-old corporate lawyer with no children
C
Kathy - age 70 with two adult children, both of whom are married
D
Roger - a 62-year-old retired bachelor - CORRECT ANSWER✅✅✅George - in his second year of
medical school; married with one child
What is the correct term for intentionally withholding facts that, if disclosed, would change the insurer's
underwriting or rating decision?
A
Misrepresentation
B
