NC Life Insurance Exam Prep Questions with Verified Solutions

NC Life Insurance Exam Prep Questions with Verified Solutions A 15-year mortgage is best protected by what kind of life policy? - Answer 15-year decreasing term A 42 year old executive wants to purchase life insurance that will allow for increases or decreases to coverage as his/her needs change. Which of the following policies will best meet this need? - Answer Universal life A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision? - Answer Payor provision A level premium indicates - Answer The premium is fixed for the entire duration of the contract A level premium indicates - Answer The premium is fixed for the entire duration of the contract A life insurance arrangement which circumvents (avoid) insurable interest statutes is called - Answer Investor-Originated Life Insurance A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as - Answer Variable life A Limited-Pay Life policy has - Answer Premium payments limited to a specified number of years A person is required to be AT LEAST how old before he or she is licensed as an agent in NC? - Answer 18 A policy owner is allowed to pay premiums more than once a year under which provision? - Answer Mode of Premium A policy owner is allowed to pay premiums more than once a year under which provision? - Answer Mode of Premium A policy owner would like to change the beneficiary on a life insurance policy and make the change permanent. Which type of designation would fulfill this need? - Answer Irrevocable A policy that becomes a Modified Endowment Contract (MEC) - Answer Will lose many of its tax advantage A policyowner is able to choose the frequency of premium payments through what policy feature? - Answer Premium mode A provision in a life insurance policy that pays the policy owner an amount that doesn't surpass the guaranteed cash value is called the - Answer Policy Loan Provision A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as - Answer A representation A term life insurance policy matures - Answer Upon the insured's death during the term of the policy A vacancy that occurs during the NC Commissioner of Insurance's term of office MUST be filled by the - Answer Governor A warranty - Answer Is a statement guaranteed to be true A Whole Life insurance policy owner does not risk to continue making premiums payments. Which of the following enables the policy owner to sell the policy for more than its cash value? - Answer Life settlement contract A written agreement to provide a Life Insurance Policyholder immediate cash in exchange for the sale and transfer of a Life Insurance Policy is a - Answer Viatical Settlement A young, married teacher has 2 children and owns a Whole Life Policy. If the teacher wants an increasing death benefit to protect against inflation, the teacher showed select which of the following Dividend Options? - Answer Paid-up Additional Insurance Acceptance - Answer Insurance acceptance occurs when an applicant for insurance receives the policy from the company. Issuance of the policy constitutes acceptance. Additional coverage can be added to a Whole Life policy by adding - Answer Decreasing term rider Additional coverage can be added to a Whole Life policy by adding a(n) - Answer Decreasing term rider