LIFE ONLY AGENT UPDATED COMPREHENSIVE QUESTIONS
AND SOLUTIONS GUARANTEE A+
✔✔what is a contingent beneficiary? - ✔✔someone the insured would name to ensure
where the policy proceeds will go if the primary beneficiary dies prior to the insured.
✔✔a non-forfeiture option that provides a new term life insurance policy with the same
face amount of coverage as the original policy, it is not a settlement option, what is this
called? - ✔✔Extended Term
✔✔dividends are declared by who? are they guaranteed? - ✔✔the board of directors.
and they cannot be guaranteed
✔✔what does the conversion feature allow? - ✔✔it allows an employee to go from
group coverage to an individual policy
✔✔what does a family policy provide? - ✔✔It provides life insurance for an entire family
and allows the children to convert from term to whole life coverage without a physical
exam.
✔✔if an employee wants to enroll without any restrictions, when would they enroll? -
✔✔they would enroll during the eligibility period (open enrollment period)
✔✔what is a group contract where the employer pays 100% of the premium referred to
as? - ✔✔a non-contributory group plan
✔✔if an individual increases their insurance policy limits they are NOT eliminating risk,
what are they doing? - ✔✔they are transferring more of their risk
✔✔risks that receive the lowest premium charges as they pose the lowest risk to the
insurer - ✔✔preferred risks
✔✔what does an insurance binder do? - ✔✔it always creates immediate coverage
which is the main difference between a binder and a conditional receipt.
✔✔what is incontestability clause? - ✔✔this is very restrictive for the insurer and
prevents them from contesting a claim for an reason after 2 years. it states that after a
life insurance policy has been in effect for 2 years, it is not able to become disputed.
✔✔define replacement - ✔✔it is when you replace your customers current policy with a
new one and is not illegal.
, ✔✔what would be considered an illegal replacement? they call this twisting. - ✔✔if you
replace your customers policy and the new policy is worse and the premium is higher.
this would be considered illegal
✔✔what is a captive insurer - ✔✔an insurer created by a corporation to insure its own
risks
✔✔if a company decides to self insure, what happens? - ✔✔this decision would not
have any impact on claims severity
✔✔if an insured wants to sell their life insurance policy to an investor (viatical/life
settlement) what would they have to do? - ✔✔they would have to request an absolute
assignment
✔✔what is an absolute assignment? - ✔✔a permanent transfer of ownership rights
✔✔individuals who hold a life-only and or/ an accident&health license must complete
how many hours of continuing education? and how often? - ✔✔they must complete 24
hours, and every 2 years in order to renew there license
✔✔an insurance company that is based in Canada and doing business in California is
called what? - ✔✔a alien insurer
✔✔the doctrine of utmost good faith states what? - ✔✔that all parties to the contract
can rely upon the statement of the other party
✔✔when a party fails to communicate that which a party knows, and ought to
communicate, so that the other party may make a sound decision is referred to as
what? - ✔✔concealment
✔✔what do employees that are covered under a group policy receive to prove there
coverage? - ✔✔they receive certificates of insurance as their proof of coverage
✔✔is purchasing life insurance to fund a buy/sell agreement a business use of life
insurance or a personal use - ✔✔it is a use of life insurance NOT personal use
✔✔what is key person life insurance used for? - ✔✔key person life insurance is used by
a business to protect themselves in case a valued employee dies. the death benefit
would be paid to the company to hire and train a replacement.
✔✔how does a contributory group policy work? - ✔✔the premium is shared between the
employer and employee. the employee contributes toward the premium
AND SOLUTIONS GUARANTEE A+
✔✔what is a contingent beneficiary? - ✔✔someone the insured would name to ensure
where the policy proceeds will go if the primary beneficiary dies prior to the insured.
✔✔a non-forfeiture option that provides a new term life insurance policy with the same
face amount of coverage as the original policy, it is not a settlement option, what is this
called? - ✔✔Extended Term
✔✔dividends are declared by who? are they guaranteed? - ✔✔the board of directors.
and they cannot be guaranteed
✔✔what does the conversion feature allow? - ✔✔it allows an employee to go from
group coverage to an individual policy
✔✔what does a family policy provide? - ✔✔It provides life insurance for an entire family
and allows the children to convert from term to whole life coverage without a physical
exam.
✔✔if an employee wants to enroll without any restrictions, when would they enroll? -
✔✔they would enroll during the eligibility period (open enrollment period)
✔✔what is a group contract where the employer pays 100% of the premium referred to
as? - ✔✔a non-contributory group plan
✔✔if an individual increases their insurance policy limits they are NOT eliminating risk,
what are they doing? - ✔✔they are transferring more of their risk
✔✔risks that receive the lowest premium charges as they pose the lowest risk to the
insurer - ✔✔preferred risks
✔✔what does an insurance binder do? - ✔✔it always creates immediate coverage
which is the main difference between a binder and a conditional receipt.
✔✔what is incontestability clause? - ✔✔this is very restrictive for the insurer and
prevents them from contesting a claim for an reason after 2 years. it states that after a
life insurance policy has been in effect for 2 years, it is not able to become disputed.
✔✔define replacement - ✔✔it is when you replace your customers current policy with a
new one and is not illegal.
, ✔✔what would be considered an illegal replacement? they call this twisting. - ✔✔if you
replace your customers policy and the new policy is worse and the premium is higher.
this would be considered illegal
✔✔what is a captive insurer - ✔✔an insurer created by a corporation to insure its own
risks
✔✔if a company decides to self insure, what happens? - ✔✔this decision would not
have any impact on claims severity
✔✔if an insured wants to sell their life insurance policy to an investor (viatical/life
settlement) what would they have to do? - ✔✔they would have to request an absolute
assignment
✔✔what is an absolute assignment? - ✔✔a permanent transfer of ownership rights
✔✔individuals who hold a life-only and or/ an accident&health license must complete
how many hours of continuing education? and how often? - ✔✔they must complete 24
hours, and every 2 years in order to renew there license
✔✔an insurance company that is based in Canada and doing business in California is
called what? - ✔✔a alien insurer
✔✔the doctrine of utmost good faith states what? - ✔✔that all parties to the contract
can rely upon the statement of the other party
✔✔when a party fails to communicate that which a party knows, and ought to
communicate, so that the other party may make a sound decision is referred to as
what? - ✔✔concealment
✔✔what do employees that are covered under a group policy receive to prove there
coverage? - ✔✔they receive certificates of insurance as their proof of coverage
✔✔is purchasing life insurance to fund a buy/sell agreement a business use of life
insurance or a personal use - ✔✔it is a use of life insurance NOT personal use
✔✔what is key person life insurance used for? - ✔✔key person life insurance is used by
a business to protect themselves in case a valued employee dies. the death benefit
would be paid to the company to hire and train a replacement.
✔✔how does a contributory group policy work? - ✔✔the premium is shared between the
employer and employee. the employee contributes toward the premium
