NC Life Insurance Exam Questions With 100% Correct Answers 2024

NC Life Insurance Exam Questions With 100% Correct Answers 2024 Fraternal Benefit Society - answerAn organization of people who share a month ethnic, religious or vocational affiliation. They are entities they have no capital stock, have a representative form of government. They exist not for profit but solely for the benefit of their members and their beneficiaries and operate on a lodge system. Fraternal Benefit Societies - answerAgents of these societies must comply with the SAME general laws governing licensing that apply to resident and nonresident agents. Graded Premium Whole Life - answerHas premiums they start very low then increase annually for a long period and stay level for the rest of the life of the policy. Death Benefit Option 1 of a universal life policy - answerthe benefit payable when the insured dies stays level and equal to the initial specified amount. Death Benefit Option 2 of a universal life policy - answerthis benefit is generally increasing. This benefit equals the policy's specified amount plus the cash value. Variable Universal Life insurance - answerCombines the features of universal life insurane with the ability to allocate premiums to a seperate account. THIS MEANS the growth of the contract's cash value is based on the performance of the underlying investment. Straight Life Income - answerprovides the largest monthly income payment for a given amount o annualized funds. Also called pure life option, income payments are made for the annuitants lifetime, regardless of how long that may be. In regards to the Section 1035 tax code, which exchanges is permitted on a tax-free basis? - answer1. life insurance for life insurance 2. Life insurance for an endowment 3.Endowment for an Endowment 4.Life insurance for an Annuity 5. Annuity for an Annuity Modified Endowment Contract (MEC) - answerTax law considers a single premium life insurance policy to be what? Anthony becomes an agent for Acme Insurance Company. Acme has not filed the Notice of appointment with the commissioner. It must do so within how many days? - answer15 Days Spendthrift Clause - answerA clause that prevents the debtors of a beneficiary from collecting the benefits before he/she receives them. Annuity death benefits - answerare not tax deductible or tax free A couple makes a combined income for $175,000 annually.Will their Individual Retirement Plan (IRA) be tax deductible? - answerNo. If it is joint an dover $123,000 there is no deduction. What is the cap on an IRA tax deduction that will provide NO DEDUCTION for a single person? - answer$74000 or more. Prepaid Tuition Plans - answerCollege saving plan that allows for the purchase of units or credits at participating colleges and universities for future tuition. Limited to instate tuition only. NOT SUBJECT TO FEDERAL TAX. Parents are able to lock in the price of tuition at that time. risk sharing - answerAllocating ownership of a risk to another party Risk Transfer - answerA pure risk is transferred from the insured to the insurer, who typically is in a stronger financial position Which is a characteristic of industrial life Insurance? - answerPremiums are payable monthly or weekly. Industrial Life Insurance - answerThese policies generally do not require a medical exam to qualify. They offer individual coverage in small face amounts usually less than $10,000. Reinsurance - answeran arrangement by which the primary insurer that initially writes the insurance transfers to another insurer part or all of the potential losses associated with such insurance How long do insurers allow backdating a policy in order to receive lower rates? - answer6 Months What are the differences between mutual insurance companies and stock insurance companies? - answerMutual insurance companies are owned by its policy holders while stock insurance companies are owned by stockholders who may or may not be policy holders. Mutual Insurance companies sell participating policies which distributes policy dividends that are NONTAXABLE while Stock companies distribute profit in the form of taxable stock dividends. Which of the following individuals would be most likely to enter into a viatical settlement? - answerBen, who is terminally il