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EXAMFX LIFE AND HEALTH EXAM NEWEST ACTUAL
EXAM COMPLETE 300 QUESTIONS AND CORRECT
DETAILED ANSWERS WITH RATIONALES (VERIFIED
ANSWERS) |ALREADY GRADED A+|| NEWEST
EXAM!!!
What is the definition of a unilateral contract? - ANSWER-
One-sided: only one party makes an enforceable promise
Insurance is the transfer of - ANSWER-Risk, not loss
apparently
What is the maximum penalty for habitual willful
noncompliance with the Fair Credit Reporting Act? -
ANSWER-$2,500
What provides an underwriter with information concerning
an applicant's health history? - ANSWER-The Medical
Information Bureau
A medical exam provides info on current health
If a consumer requests additional information concerning
an investigative consumer report, how long does the
insurer or reporting agency have to comply? - ANSWER-5
days
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What is term insurance? - ANSWER-Temporary protection
because it only provides coverage for a specific period of
time.
"Pure life insurance"
Provide the greatest amount of coverage for the lowest
premium
Usually a max age above which coverage will not be
offered or renewed
No cash value or other living benefits and if an insured
dies during term, the policy pays the death benefit to the
beneficiary
What are the three basic types of term coverage
available? - ANSWER-Level, increasing, and decreasing
What fluctuates in the different types of term coverage? -
ANSWER-Regardless of the type of term, the premium
stays level throughout the term of the policy. Only the
amount of the death benefit may fluctuate, depending on
the type of term insurance
What happens in a Level term insurance policy? -
ANSWER-The death benefit does not change throughout
the life of the policy
Most common type of temporary protection used
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What happens to the death penalty and premium in a 10-
year level term $100,000 policy? - ANSWER-Premium
stays the same and the death penalty will be the same no
matter when the insured dies
If the policy renews after 10 years, the premium will be
based on the insured's attained age
What happens in the annually renewable term? (ART) -
ANSWER-Premiums stay level for a year and then the
policy must be renewed. Usually is guaranteed to be
renewable without proof of insurability, but the premium
increases due to attained age
What happens in a decreasing term policy? - ANSWER-A
level premium and a death benefit that decreases each
year over the duration of the policy term
Usually used when the amount of needed protection is
time sensitive or decreases over time
Usually convertible, but usually not renewable since the
death benefit is $0 at the end of the policy term
What is a decreasing term policy usually used for? -
ANSWER-Commonly used to insure the payment of a
mortgage or other debts if the insured dies prematurely
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Amount of coverage decreases as the outstanding load
balance decreases
What is a return of premium life insurance policy? (ROP) -
ANSWER-Increasing term insurance policy that pays an
additional death benefit to the beneficiary equal to the
amount of the premiums paid
ROP is paid if the death occurs within a specified period of
time or if the insured outlives the policy term
How is a Return of Premium life insurance policy
structured differently? - ANSWER-Structured to consider
the low risk factor of a term policy but at a significant
increase in premium cost
Traditional policies offer low-cost, simple death benefit for
a specified term but no investment component or cash
value= term expires and you have no coverage
What does it mean if a policy is renewable? - ANSWER-
Allows the policyowner the right to renew the coverage at
the expiration date without evidence of insurability
What is survivorship life insurance? - ANSWER-"last
survivor" policy
Pays at last death
EXAMFX LIFE AND HEALTH EXAM NEWEST ACTUAL
EXAM COMPLETE 300 QUESTIONS AND CORRECT
DETAILED ANSWERS WITH RATIONALES (VERIFIED
ANSWERS) |ALREADY GRADED A+|| NEWEST
EXAM!!!
What is the definition of a unilateral contract? - ANSWER-
One-sided: only one party makes an enforceable promise
Insurance is the transfer of - ANSWER-Risk, not loss
apparently
What is the maximum penalty for habitual willful
noncompliance with the Fair Credit Reporting Act? -
ANSWER-$2,500
What provides an underwriter with information concerning
an applicant's health history? - ANSWER-The Medical
Information Bureau
A medical exam provides info on current health
If a consumer requests additional information concerning
an investigative consumer report, how long does the
insurer or reporting agency have to comply? - ANSWER-5
days
,2|Page
What is term insurance? - ANSWER-Temporary protection
because it only provides coverage for a specific period of
time.
"Pure life insurance"
Provide the greatest amount of coverage for the lowest
premium
Usually a max age above which coverage will not be
offered or renewed
No cash value or other living benefits and if an insured
dies during term, the policy pays the death benefit to the
beneficiary
What are the three basic types of term coverage
available? - ANSWER-Level, increasing, and decreasing
What fluctuates in the different types of term coverage? -
ANSWER-Regardless of the type of term, the premium
stays level throughout the term of the policy. Only the
amount of the death benefit may fluctuate, depending on
the type of term insurance
What happens in a Level term insurance policy? -
ANSWER-The death benefit does not change throughout
the life of the policy
Most common type of temporary protection used
,3|Page
What happens to the death penalty and premium in a 10-
year level term $100,000 policy? - ANSWER-Premium
stays the same and the death penalty will be the same no
matter when the insured dies
If the policy renews after 10 years, the premium will be
based on the insured's attained age
What happens in the annually renewable term? (ART) -
ANSWER-Premiums stay level for a year and then the
policy must be renewed. Usually is guaranteed to be
renewable without proof of insurability, but the premium
increases due to attained age
What happens in a decreasing term policy? - ANSWER-A
level premium and a death benefit that decreases each
year over the duration of the policy term
Usually used when the amount of needed protection is
time sensitive or decreases over time
Usually convertible, but usually not renewable since the
death benefit is $0 at the end of the policy term
What is a decreasing term policy usually used for? -
ANSWER-Commonly used to insure the payment of a
mortgage or other debts if the insured dies prematurely
, 4|Page
Amount of coverage decreases as the outstanding load
balance decreases
What is a return of premium life insurance policy? (ROP) -
ANSWER-Increasing term insurance policy that pays an
additional death benefit to the beneficiary equal to the
amount of the premiums paid
ROP is paid if the death occurs within a specified period of
time or if the insured outlives the policy term
How is a Return of Premium life insurance policy
structured differently? - ANSWER-Structured to consider
the low risk factor of a term policy but at a significant
increase in premium cost
Traditional policies offer low-cost, simple death benefit for
a specified term but no investment component or cash
value= term expires and you have no coverage
What does it mean if a policy is renewable? - ANSWER-
Allows the policyowner the right to renew the coverage at
the expiration date without evidence of insurability
What is survivorship life insurance? - ANSWER-"last
survivor" policy
Pays at last death
