Arkansas Life Insurance Exam Questions With 100% Correct Answers 2024/2025

Arkansas Life Insurance Exam Questions With 100% Correct Answers 2024/2025 J is a producer who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of? - answerTwisting What is implied authority defined as? - answerAuthority that is not specifically given to an agent contract, but that an agent can reasonably assume to carry out his/her duties A person who is a nonsmoker, average weight, excellent health would fall into what risk classification? - answerPreferred Which of the following is considered to be the period when the accumulated value in an annuity is paid out? - answerAnnuitization phase An insurers claim settlement practices are regulated by the: - answerState insurance departments An insurers ability to make unpredictable payouts to policy owners is called: - answerLiquidity Which of the following pertains to the analysis of an applicants personal information and determining whether insurance should be issued or declined? - answerUnderwriting What does the Group Life underwriting risk selection process help protect insurance companies from? - answerAdverse Selection The Arkansas Life & Disability Insurance Guaranty Association assures payment of benefits from insurance policies for insolvent insurers, and covers all of the following insured policies, EXCEPT: - answerLiability Insurance What would happen if a life insurance applicant is given a conditional receipt from an insurance agent and then dies the next day? - answerClaim will be paid if application is approved A life insurance policy owner does NOT have the right to: - answerRevoke an absolute assignment An employee under a group insurance policy has the right to name a beneficiary and the right to: - answerConvert to an individual policy in the event of employment termination The two major actions required for a policyholder to comply with the Reinstatement Clause are - answerProvide evidence of insurability, past due premiums Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following statements is true? - answerThe policy may be paid up early by using policy dividends Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If the consumer price index has gone up 4%, how much may Ron increase the face value of the policy? - answer$4,000 ($100,000 X .04 = $4,000) Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Which of these statements is true? - answerThe face amount and premium will remain constant over the 10-year period What is Arkansas' REQUIRED grace period for a life insurance contract? - answer31 days A domestic insurance company in Arkansas MUST - answerBe organized under Arkansas Insurance laws Simon has purchased a fixed immediate annuity. His payment amount will be dependent upon principal, interest, and the contract's - answerIncome period What kind of life insurance policy issued by a mutual insurer provides a return of divisible surplus? - answerParticipating life insurance policy No one is allowed to act as a producer for any insurance company in Arkansas that - answerIs unauthorized to do business in Arkansas What MUST the company do prior to conducting an HIV related test? - answerObtain a written consent from the proposed insured Which approach predicts a person's earning potential and determines how much of that amount would be devoted to dependents? - answerHuman life value approach If the annuitant dies before the annuity start date, - answerThe premiums paid plus interest earned will be given to the beneficiary If dividends are illustrated, the advertisement MUST state that the dividends are: - answerNot guaranteed Intentional withholding of material facts that would affect an insurance policy's validity is called a(n) - answerConcealment Field underwriting performed by the producer involves - answerCompleting the application and collecting initial premium Which of the following statements is CORRECT regarding an individual applying for life or health insurance? - answerThe applicants medical history may be analyzed and reported Life insurance policies will normally pay for losses arising from - answerCommercial aviation An example of rebating would be - answerOffering a client something of value not stated in the contract in exchange for their business Which type of insurance company allows their policyowners to elect governing body? - answerMutual Which type of life insurance policy pays the face amount at the end of the specified period if the insured is still alive? - answerEndowment policy A life insurance claim which involves a per capita distribution of policy proceeds would be payable to the - answerNamed living primary beneficiaries A type of group that has a constitution and bylaws and has been organized for purposes other than obtaining insurance is called a(n) - answerAssociation or labor group What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? - answerRepresentation Ken is a producer who has obtained Consumer Information Reports under false pretenses. Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed on Ken? - answer$5,000 The _________ must provide an insured with proper disclosure concerning the replacement of a life insurance policy - answerProducer Within how many days must a rollover be completed in order to avoid being taxed as current income? - answer60 days to complete the rollover to another IRA Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life policy covering all three of their lives. If Mike dies first, the policy proceeds - answerWill no longer provide insurance protection An insurer may pay commissions directly to any person for services as a producer provided the producer is licensed and ________ - answerAppointed The principle of insurable interest, in regards to a life insurance contract, is accurately described in which statement? - answerInsurable interest can be based on the love and affection of individuals related by blood or law Andy the annuitant dies before the annuity start date. Which of the following is a TRUE statement? - answerPremiums paid plus interest earned is returned to the beneficiary