NC Life Insurance Practice Exam Questions with 100% Current Answers

NC Life Insurance Practice Exam Questions with 100% Current Answers A college student will graduate next year. His studies have limited his ability to work, so he has borrowed funds to pay for his education. He would like to start a permanent life insurance program that would cover his debt and still be affordable during the period he is establishing his earning potential. An appropriate policy would be a). Level Term to age 65 b). Single Premium Whole Life c). Modified Whole Life d). Current Assumption Whole Life - Answer c). Modified Whole Life Modified life required low premiums at the beginning of the policy. The premiums are increased at a later date, usually three to five years after the issue. A group of 15 skydivers met at a seminar and began talking about life insurance during a break. Because it was expensive to get individual life insurance, they decided to band together to form a small group so that they could qualify for group life insurance. After they applied for group life insurance, they were rejected. Why? a)There are not enough people in the group to qualify for group life insurance. b)The group has not been established for long enough. c)The purpose of the group was to purchase life insurance. d)Their profession poses too high of a risk for the insurer. - Answer c)The purpose of the group was to purchase life insurance. In order to qualify for small group life insurance, a group must be formed for a purpose other than attaining life insurance. A licensee who ceases to maintain residency in North Carolina is required to deliver any insurance licenses to the Commissioner by mail or in person within how many days after terminating residency? a)10 days b)21 days c)30 days d)90 days - Answer c)30 days Any licensee who ceases to maintain his residency in North Carolina shall deliver his insurance license or licenses to the Commissioner by personal delivery or by mail within 30 days after terminating residency. A married couple owns a permanent policy which covers both of their lives and pays the death benefit only upon the death of the first insured. Which policy is that? a)Second-to-Die b)Family Income Policy c)Joint Life Policy d)Survivorship Life Policy - Answer c)Joint Life Policy Joint life policies cover the lives of two insureds; rates are blended. Upon the death of the first insured, the policy ends. A person who knowingly obtains information about an individual from an agent or the insurer under false pretenses has committed a(n) a)Class 1 misdemeanor. b)Trustworthy act. c)Unfair trade practice. d)Felony. - Answer a) Class 1 misdemeanor. A person who knowingly obtains information about an individual from an insurer or agent under false pretenses is guilty of a Class 1 misdemeanor. A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this? a)Level term b)Term to specified age c)Ordinary life policy d)Limited pay whole life - Answer a)Level term A 20-year term policy is written to provide a level death benefit for 20 years. A policyowner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision? a)Waiver of premium b)Incontestability period c)Assignment d)Automatic premium loan - Answer d)Automatic premium loan This provision is not required, but is commonly added to contracts with a cash value at no additional charge. This is a special type of loan that prevents the unintentional lapse of a policy due to nonpayment of the premium. A Universal Life Insurance policy is best described as a/an a)Annually Renewable Term policy with a cash value account. b)Variable Life with a cash value account. c)Whole Life policy with two premiums: target and minimum. d)Flexible Premium Variable Life policy. - Answer a)Annually Renewable Term policy with a cash value account.