NC Life Exam Simulation Questions With 100% Correct Answers 2024

NC Life Exam Simulation Questions With 100% Correct Answers 2024 Which of the following actions require a policyowner to provide proof of insurability in an Adjustable Life policy? - answerANSWER: increase face amount 2. If the Commissioner of insurance finds that a licensed person has used fraudulent, coercive, or dishonest practices or has proved to be incompetent, untrustworthy, or financially irresponsible, the law allows the Commissioner to - answerANSWER: suspend, revoke, or refuse to renew the agent's license 3. A Whole Life Insurance Policy endows when the: - answerANSWER: Cash value equals the death benefit 4. A provision in a life insurance policy that pays the policyowner an amount that does not surpass the guaranteed cash value is called the: - answerANSWER: Policy Loan provision 5. The Life and Health Insurance Guaranty Association becomes involved in an insurance company's affairs when the company - answerANSWER: becomes insolvent 6. If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of? - answerANSWER: Insured 7. M purchases a $70,000 Life Insurance Policy with premium payments of $550 a year for the first 5 years. At the beginning of the sixth year, the premium will increase to $800 per year but will remain level thereafter. The face amount will remain at $70,000 throughout the life of the policy. The type of policy that M has purchased is: - answerANSWER: Adjustable Life 8. Which parts of a life insurance policy are guaranteed to be true? - answerANSWER: Warranty 9. Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation? - answerANSWER: Policy was returned within the free-look period, premium will be fully refunded 10. Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it? - answerANSWER: Decreasing Term 11. Which of the following consists of an offer, acceptance, and consideration? - answerANSWER: Contract 12. According to North Carolina's rules on disclosure, a life insurance applicant is expected to be provided with - answerANSWER: a Buyer's Guide and Policy Summary 13. Which of the following statements about noncontributory employee group life insurance is FALSE? - answerANSWER: A minimum number of employees is required to participate 14. The automatic premium loan provision is designed to: - answerANSWER: avoid a policy lapse 15. The amount received for a life insurance policy in a viatical settlement is - answerANSWER: Less than the death benefit 16. If after satisfactory proof of loss, an insurer fails or refuses to pay death proceeds, the insurer must pay interest on the proceeds after how many days? - answerANSWER: 30 17. When a life insurance policy exceeds certain IRS table values, the result would create which of the following? - answerANSWER: Modified Endowment Contract (MEC) 18. A written agreement to provide a Life Insurance Policy holder immediate cash in exchange for the sale and transfer of a Life Insurance Policy is a - answerANSWER: Viatical Settlement 19. The annuity that represents the largest possible monthly payment to an individual annuitant is a(n): - answerANSWER: Straight Life annuity 20. The fund that assures policyholders payment of death benefits on Life Policies, if the company is insolvent at the time of the claim, is called the - answerANSWER: Life and Health Insurance Guaranty Association 21. The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is: - answerANSWER: the cost 22. Which of these is NOT considered to be an element of an insurance contract? - answerANSWER: negotiating 23. J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value? - answerANSWER: 20-pay Life 24. A trustee-to-trustee transfer of rollover funds in a qualified plan allows a participant to avoid: - answerANSWER: mandatory income tax withholding on the transfer amount 25. A policyowner is allowed to pay premiums more than once a year under which provision? - answerANSWER: Mode of Premium 26. Which type of life policy contains a monthly mortality charge as well as self-directed investment choices? - answerANSWER: Variable Universal Life 27. Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling? - answerANSWER: Variable Life 28. What does a 401(k) plan generally provide its participants? - answerANSWER: Salary- deferral contributions 29. Which of the following statements regarding a Tax Sheltered Annuity (TSA) is INCORRECT? - answerANSWER: The income from the TSA is received income tax-free 30. An insurance company MUST clearly specify questions designed to obtain information solely for marketing research - answerANSWER: in any insurance transaction 31. Proceeds of the viatical settlement contract could be subject to the claims of - answerANSWER: Creditors 32. M had an annual life insurance premium payment due January 1. She died January 10 without making the premium payment. What action will the insurer take? - answerANSWER: Pay face amount minus the past due premium 33. Which of these statements concerning an Individual Straight Life annuity is accurate? - answerANSWER: Payments are made to an annuitant for life 34. What type of life policy covers two people and pays upon the death of the last insured? - answerANSWER: Survivorship 35. L, aged 50, and L's spouse, 48, have one natural child and one adopted child. They purchase a Family Policy that covers L's spouse to age 65. A death benefit will NOT be paid in which of the following circumstances? - answerANSWER: L's spouse dies at age 66. 36. P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take? - answerANSWER: Beneficiary will be paid the Death Benefit 37. How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy? - answerANSWER: If the primary beneficiary dies before the insured 38. When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n): - answerANSWER: Anti-Money Laundering violation