ALU 202 EXAM SCRIPT TESTED QUESTIONS
WITH VERIFIED ANSWERS PRACTICE
SOLUTION GRADED A+
⩥ How are estate growth and insurable interest concerns different when
underwriting an elderly proposed insured?.
Answer: Refer to pages 135-137.
⩥ Discuss the arguments for and against estate tax..
Answer: Refer to page 120.
⩥ Name five allowable deductions from the gross estate to arrive at the
adjusted gross estate..
Answer: Refer to page 122.
⩥ All of the following statements regarding guaranteed issue (GI) are
correct EXCEPT:
1. It assures the highest level of accepted risks.
2. Being out of work due to illness is generally not a concern.
3. The individual participant needs only to complete a consent form.
4. This is the most efficient method of underwriting groups of lives..
,Answer: Answer 2: Being out of work due to illness is generally not a
concern - page 154.
⩥ The type of underwriting in which one or more modestly substandard
risks is accepted at standard pricing after full underwriting is:
1. simplified issue
2. bundle underwriting
3. guaranteed issue
4. preferred underwriting.
Answer: Answer 2: bundle underwriting - page 153.
⩥ All of the following are common nonqualified executive
compensation plans EXCEPT:
1. section 162 bonus plans
2. equity repurchase plans
3. deferred compensation plans
4. employee stock ownership plans (ESOPs).
Answer: Answer 4: employee stock ownership plans (ESOPs) - pages
155-156.
, ⩥ Discuss the concept of "spread of risk" and how it relates to the
maximum death benefit on any one life when using a guaranteed issue
method of underwriting..
Answer: Refer to pages 149-150.
⩥ Compare and contrast simplified issue and guaranteed issue as
methods of underwriting..
Answer: Refer to pages 153-155.
⩥ Which of the following statements regarding corporate-owned life
insurance (COLI) is/are correct?
A. It uses life insurance in tax-advantaged ways.
B. It was developed as an executive benefit.
C. It does not contain eligibility requirements for coverage.
Answer Options:
1. A only is correct.
2. B only is correct.
3. A and B only are correct.
4. B and C only are correct..
Answer: Answer 3: A and B only are correct - pages 147-148.
WITH VERIFIED ANSWERS PRACTICE
SOLUTION GRADED A+
⩥ How are estate growth and insurable interest concerns different when
underwriting an elderly proposed insured?.
Answer: Refer to pages 135-137.
⩥ Discuss the arguments for and against estate tax..
Answer: Refer to page 120.
⩥ Name five allowable deductions from the gross estate to arrive at the
adjusted gross estate..
Answer: Refer to page 122.
⩥ All of the following statements regarding guaranteed issue (GI) are
correct EXCEPT:
1. It assures the highest level of accepted risks.
2. Being out of work due to illness is generally not a concern.
3. The individual participant needs only to complete a consent form.
4. This is the most efficient method of underwriting groups of lives..
,Answer: Answer 2: Being out of work due to illness is generally not a
concern - page 154.
⩥ The type of underwriting in which one or more modestly substandard
risks is accepted at standard pricing after full underwriting is:
1. simplified issue
2. bundle underwriting
3. guaranteed issue
4. preferred underwriting.
Answer: Answer 2: bundle underwriting - page 153.
⩥ All of the following are common nonqualified executive
compensation plans EXCEPT:
1. section 162 bonus plans
2. equity repurchase plans
3. deferred compensation plans
4. employee stock ownership plans (ESOPs).
Answer: Answer 4: employee stock ownership plans (ESOPs) - pages
155-156.
, ⩥ Discuss the concept of "spread of risk" and how it relates to the
maximum death benefit on any one life when using a guaranteed issue
method of underwriting..
Answer: Refer to pages 149-150.
⩥ Compare and contrast simplified issue and guaranteed issue as
methods of underwriting..
Answer: Refer to pages 153-155.
⩥ Which of the following statements regarding corporate-owned life
insurance (COLI) is/are correct?
A. It uses life insurance in tax-advantaged ways.
B. It was developed as an executive benefit.
C. It does not contain eligibility requirements for coverage.
Answer Options:
1. A only is correct.
2. B only is correct.
3. A and B only are correct.
4. B and C only are correct..
Answer: Answer 3: A and B only are correct - pages 147-148.
