State Farm Assessment Exam Questions with Correct Answers

State Farm Assessment Exam Questions with Correct Answers common disaster provision - Answer-This policy provision provides an alternative beneficiary in the event that the insured and the original beneficiary die as the result of a common accident. Consideration - Answer-Element of a legal contract consisting of premium payment and statements made by the prospective insured in the application. Cash Value - Answer-The equity amount or savings accumulation in a permanent life policy. Collateral assignment - Answer-Assignment of a policy to a creditor as a security for a debt. At the insured death, the creditor is entitled to be reimbursed out of policy proceeds for the amount owed and any excess will go to the beneficiary. Conditional receipt - Answer-Given to the policyowners when they pay a premium at time of application. in this case, the applicant is covered the later of the date of the application or proof of insurability, even though the policy may not have been issued. Consideration, legal purpose, offer, acceptance. and competent parties. - Answer-The five parts of a legal contract. Contingent beneficiary - Answer-Persons named to receive proceeds in case the original beneficiary is not alive. cost-of-living (col) rider - Answer-A rider available with some policies that provides for an automatic increase in benefits ( typically tied to the consumer price index.) offsetting the effects of inflation. This will result in an automatic increase in premium.