General Life Insurance Exam Latest
Updated Solved 100% Correct
A policy is delivered by a messenger from Big Brown Delivery service. The method
used for delivery was?
A: Constructive
B: Personal
C: Mail
D: Conditional - ANSWER-A: Constructive
A policy is purchased by direct response when must the policy summary be supplied?
A: Before paying a premium
B: At policy delivery
C: At policy delivery if payment was not made with application
D: At the policy's first anniversary - ANSWER-B: At policy delivery
A policyholder purchased a Single Premium Whole Life policy in 2001 when they were
30 years old. In 2012, the policyholder takes a loan out. Which of the following is
CORRECT regarding taxation of this loan?
A: The loan is taken tax free
B: The loan is taxable
C: The loan is taxable plus a 10% penalty
D: None of the Above - ANSWER-C: The loan is taxable plus a 10% penalty
A producer is served with a Cease and Desist Order for unfair competition and he
violates the Order. The statutory fine for this action is
A: 500
B: 1000
C: 2000
D: $100 per day up to a maximum of $5,000. - ANSWER-B: 1000
A producer must be licensed in securities to sell any of the following policies EXCEPT:
A: Equity Index
B: Variable Life
C: Variable Whole Life
D: Variable Universal Life - ANSWER-A: Equity Index
A Replacing Insurer must forward the Notice Regarding Replacement form to the
Existing Insurer within:
A: 3 working days
B: 3 calendar days
C: 3 years
D: 7 days - ANSWER-A: 3 working days
,A Survivorship life policy insures two or more lives and the same time and pays death
benefit:
A: When the first insured dies
B: When the last insured dies
C: When the owner of the policy dies
D: When the beneficiary dies - ANSWER-B: When the last insured dies
A Temporary License (180 days) allows the holder to engage in all of the following
activities, EXCEPT:
A: a surviving spouse of a producer can use the authority to help effect the sale of the
insurance business.
B: make certain that insureds are paying renewal premiums in a timely manner.
C: ask the Director to extend the authority if an anticipated agency sale is taking longer
than 180 days.
D: sell a new policy to an existing client. - ANSWER-D: sell a new policy to an existing
client.
A terminally ill insured who sells a portion of the life insurance proceeds before they die
in exchange for immediate cash payment is known as:
A: a viator
B: an insured
C: a Viatical settlement
D: a life settlement recipient - ANSWER-A: a viator
A Viator has decided to rescind a deal after payment has been made. How many days
does a Viator in this situation have?
A: 30 days
B: 15 days
C: 10 days
D: It is too late - ANSWER-B: 15 days
Absolute assignment:
A: Allows the policyholder to transfer partial ownership on a temporary basis.
B: Changes the owner of a policy once insurable interest is proven.
C: Allows the policyholder to take a loan from a term policy.
D: Allows the policyholder to change the owner of a policy fully and on a permanent
basis, regardless of insurance interest. - ANSWER-D: Allows the policyholder to change
the owner of a policy fully and on a permanent basis, regardless of insurance interest.
All of the following actions by a producer could lead to license suspension, revocation or
denial, EXCEPT:
A: being incompetent in the transactions of insurance business.
B: failure to pay federal income taxes.
C: using dishonest business practices.
D: being unworthy of trust. - ANSWER-B: failure to pay federal income taxes.
,All of the following are considered to be Non-Qualified Tax Plans EXCEPT:
A: Whole Life
B: Universal Life
C: Roth IRA
D: IRA - ANSWER-D: IRA
All of the following are guaranteed components of a whole life policy EXCEPT:
A: Premium
B: Cash Value
C: Death Benefit
D: The policy will expire - ANSWER-D: The policy will expire
All of the following are true regarding the Guaranty Association EXCEPT:
A: A claimant may receive less benefits than what they had from a policy.
B: The Association is comprised of All member insurers
C: The Association is comprised of All member insurers and have a right to end
membership while still transacting business in IL
D: There is a $250,000 limit on the present value of annuity benefits. - ANSWER-C: The
Association is comprised of All member insurers and have a right to end membership
while still transacting business in IL
All of the following disbursements from a Premium Fund Trust Account are legally
allowed, EXCEPT:
A: returned premiums due to an insured.
B: the payment of rent for the insurance agency.
C: commissions to producers.
D: bank fees. - ANSWER-B: the payment of rent for the insurance agency.
All of the following is an example of an unfair practice EXCEPT:
A: An applicant being denied based on military experience
B: An applicant being denied based off partial blindness
C: An applicant being denied for being a sky dive instructor
D: An applicant being denied solely for being disabled. - ANSWER-C: An applicant
being denied for being a sky dive instructor
All of the following is not true about unfair practices EXCEPT:
A: insurers can rate an insured because they are blind
B: insurers can rate insured because they are disabled
C: insurers can rate an insured because of prior health impairment that is applied to the
entire risk class and is not based of being unfairly discriminatory
D: insurers can rate because of partial blindness - ANSWER-C: insurers can rate an
insured because of prior health impairment that is applied to the entire risk class and is
not based of being unfairly discriminatory
All of the following policies have non-forfeiture options EXCEPT:
A: Whole Life
, B: Universal Life
C: Life Paid @ Age 65
D: Level Term - ANSWER-D: Level Term
All of the following statements about a Guaranteed Insurability Rider are true EXCEPT:
A: Additional insurance is purchased at the rate charged when the contract was
originally issued.
B: It is available for purchase by insureds who are below some stated maximum age.
C: Additional purchases of insurance are guaranteed without proof of insurability.
D: The cost of the rider is in addition to the cost of the policy to which it is attached. -
ANSWER-A: Additional insurance is purchased at the rate charged when the contract
was originally issued.
All of the following statements are CORRECT about a Business Disability Buyout policy
EXCEPT:
A: Premiums are Not Tax Deductible.
B: Benefits are Tax Free, Lump sum amount.
C: The policy has a very short elimination period usually up to 30 days maximum.
D: None of the Above - ANSWER-C: The policy has a very short elimination period
usually up to 30 days maximum.
All of the following statements are true regarding Accelerated Benefits EXCEPT:
A: The department of insurance must review all policy forms.
B: The insurer can require medical evidence proof of a qualifying condition.
C: Accelerated Benefits can be paid in lump sum.
D: The remaining death benefit can be reduced by 75% after the accelerated benefits
are deducted. - ANSWER-D: The remaining death benefit can be reduced by 75% after
the accelerated benefits are deducted.
All of the following statements are true regarding Accelerated Benefits EXCEPT:
A: The department of insurance must review all policy forms.
B: The insurer can require medical evidence proof of a qualifying condition.
C: Accelerated Benefits can be paid in lump sum.
D: The remaining death benefit can be reduced by 75% after the accelerated benefits
are deducted. - ANSWER-D: The remaining death benefit can be reduced by 75% after
the accelerated benefits are deducted.
All of the following statements pertaining to a person who has had their producer license
revoked are true, EXCEPT:
A: Such person may not be employed in any insurance capacity for at least 3 years.
B: Such person may not be contracted in any insurance capacity for at least 3 years.
C: Such person is banned from the insurance for life.
D: Such person may not engage in any insurance capacity for at least 3 years. -
ANSWER-C: Such person is banned from the insurance for life.
Updated Solved 100% Correct
A policy is delivered by a messenger from Big Brown Delivery service. The method
used for delivery was?
A: Constructive
B: Personal
C: Mail
D: Conditional - ANSWER-A: Constructive
A policy is purchased by direct response when must the policy summary be supplied?
A: Before paying a premium
B: At policy delivery
C: At policy delivery if payment was not made with application
D: At the policy's first anniversary - ANSWER-B: At policy delivery
A policyholder purchased a Single Premium Whole Life policy in 2001 when they were
30 years old. In 2012, the policyholder takes a loan out. Which of the following is
CORRECT regarding taxation of this loan?
A: The loan is taken tax free
B: The loan is taxable
C: The loan is taxable plus a 10% penalty
D: None of the Above - ANSWER-C: The loan is taxable plus a 10% penalty
A producer is served with a Cease and Desist Order for unfair competition and he
violates the Order. The statutory fine for this action is
A: 500
B: 1000
C: 2000
D: $100 per day up to a maximum of $5,000. - ANSWER-B: 1000
A producer must be licensed in securities to sell any of the following policies EXCEPT:
A: Equity Index
B: Variable Life
C: Variable Whole Life
D: Variable Universal Life - ANSWER-A: Equity Index
A Replacing Insurer must forward the Notice Regarding Replacement form to the
Existing Insurer within:
A: 3 working days
B: 3 calendar days
C: 3 years
D: 7 days - ANSWER-A: 3 working days
,A Survivorship life policy insures two or more lives and the same time and pays death
benefit:
A: When the first insured dies
B: When the last insured dies
C: When the owner of the policy dies
D: When the beneficiary dies - ANSWER-B: When the last insured dies
A Temporary License (180 days) allows the holder to engage in all of the following
activities, EXCEPT:
A: a surviving spouse of a producer can use the authority to help effect the sale of the
insurance business.
B: make certain that insureds are paying renewal premiums in a timely manner.
C: ask the Director to extend the authority if an anticipated agency sale is taking longer
than 180 days.
D: sell a new policy to an existing client. - ANSWER-D: sell a new policy to an existing
client.
A terminally ill insured who sells a portion of the life insurance proceeds before they die
in exchange for immediate cash payment is known as:
A: a viator
B: an insured
C: a Viatical settlement
D: a life settlement recipient - ANSWER-A: a viator
A Viator has decided to rescind a deal after payment has been made. How many days
does a Viator in this situation have?
A: 30 days
B: 15 days
C: 10 days
D: It is too late - ANSWER-B: 15 days
Absolute assignment:
A: Allows the policyholder to transfer partial ownership on a temporary basis.
B: Changes the owner of a policy once insurable interest is proven.
C: Allows the policyholder to take a loan from a term policy.
D: Allows the policyholder to change the owner of a policy fully and on a permanent
basis, regardless of insurance interest. - ANSWER-D: Allows the policyholder to change
the owner of a policy fully and on a permanent basis, regardless of insurance interest.
All of the following actions by a producer could lead to license suspension, revocation or
denial, EXCEPT:
A: being incompetent in the transactions of insurance business.
B: failure to pay federal income taxes.
C: using dishonest business practices.
D: being unworthy of trust. - ANSWER-B: failure to pay federal income taxes.
,All of the following are considered to be Non-Qualified Tax Plans EXCEPT:
A: Whole Life
B: Universal Life
C: Roth IRA
D: IRA - ANSWER-D: IRA
All of the following are guaranteed components of a whole life policy EXCEPT:
A: Premium
B: Cash Value
C: Death Benefit
D: The policy will expire - ANSWER-D: The policy will expire
All of the following are true regarding the Guaranty Association EXCEPT:
A: A claimant may receive less benefits than what they had from a policy.
B: The Association is comprised of All member insurers
C: The Association is comprised of All member insurers and have a right to end
membership while still transacting business in IL
D: There is a $250,000 limit on the present value of annuity benefits. - ANSWER-C: The
Association is comprised of All member insurers and have a right to end membership
while still transacting business in IL
All of the following disbursements from a Premium Fund Trust Account are legally
allowed, EXCEPT:
A: returned premiums due to an insured.
B: the payment of rent for the insurance agency.
C: commissions to producers.
D: bank fees. - ANSWER-B: the payment of rent for the insurance agency.
All of the following is an example of an unfair practice EXCEPT:
A: An applicant being denied based on military experience
B: An applicant being denied based off partial blindness
C: An applicant being denied for being a sky dive instructor
D: An applicant being denied solely for being disabled. - ANSWER-C: An applicant
being denied for being a sky dive instructor
All of the following is not true about unfair practices EXCEPT:
A: insurers can rate an insured because they are blind
B: insurers can rate insured because they are disabled
C: insurers can rate an insured because of prior health impairment that is applied to the
entire risk class and is not based of being unfairly discriminatory
D: insurers can rate because of partial blindness - ANSWER-C: insurers can rate an
insured because of prior health impairment that is applied to the entire risk class and is
not based of being unfairly discriminatory
All of the following policies have non-forfeiture options EXCEPT:
A: Whole Life
, B: Universal Life
C: Life Paid @ Age 65
D: Level Term - ANSWER-D: Level Term
All of the following statements about a Guaranteed Insurability Rider are true EXCEPT:
A: Additional insurance is purchased at the rate charged when the contract was
originally issued.
B: It is available for purchase by insureds who are below some stated maximum age.
C: Additional purchases of insurance are guaranteed without proof of insurability.
D: The cost of the rider is in addition to the cost of the policy to which it is attached. -
ANSWER-A: Additional insurance is purchased at the rate charged when the contract
was originally issued.
All of the following statements are CORRECT about a Business Disability Buyout policy
EXCEPT:
A: Premiums are Not Tax Deductible.
B: Benefits are Tax Free, Lump sum amount.
C: The policy has a very short elimination period usually up to 30 days maximum.
D: None of the Above - ANSWER-C: The policy has a very short elimination period
usually up to 30 days maximum.
All of the following statements are true regarding Accelerated Benefits EXCEPT:
A: The department of insurance must review all policy forms.
B: The insurer can require medical evidence proof of a qualifying condition.
C: Accelerated Benefits can be paid in lump sum.
D: The remaining death benefit can be reduced by 75% after the accelerated benefits
are deducted. - ANSWER-D: The remaining death benefit can be reduced by 75% after
the accelerated benefits are deducted.
All of the following statements are true regarding Accelerated Benefits EXCEPT:
A: The department of insurance must review all policy forms.
B: The insurer can require medical evidence proof of a qualifying condition.
C: Accelerated Benefits can be paid in lump sum.
D: The remaining death benefit can be reduced by 75% after the accelerated benefits
are deducted. - ANSWER-D: The remaining death benefit can be reduced by 75% after
the accelerated benefits are deducted.
All of the following statements pertaining to a person who has had their producer license
revoked are true, EXCEPT:
A: Such person may not be employed in any insurance capacity for at least 3 years.
B: Such person may not be contracted in any insurance capacity for at least 3 years.
C: Such person is banned from the insurance for life.
D: Such person may not engage in any insurance capacity for at least 3 years. -
ANSWER-C: Such person is banned from the insurance for life.
