Indiana Life Insurance Exam
- ANS-Under the Unfair Competition Statute
a. Financial institutions may require insurance on the lives of debtors.
b. Premiums may not be based upon the age or gender of an applicant.
c. Participating policies must guarantee dividends.
d. Rebates may be paid to consumers, if it is in "the public interest."
. It is the same as a Modified Life Policy - ANS-Which of the following statements is NOT true
about Enhanced Ordinary Life?
a. It is the same as a Modified Life policy.
b. It is a combination of continuous premium Whole Life and Renewable Term.
c. Policy dividends are used to purchase Paid Up Additions.
d. It is only available on Participating Life insurance policies.
$25,000 - ANS-If the Commissioner issues a cease-and-desist order and you continue the same
activities, you can be fined up to which of the following amounts per violation of that order?
a. $5,000
b. $1,000
c. $50,000
d. $25,000
1. A Single Premium
2. Limited Pay (For a limited period of time)
3. Straight Life (Continuous) Premium
The shorter the payment period, the higher each individual payment but the lower the total cost.
The longer the payment period, the smaller the individual premiums, but the greater the total
cost. No matter how it's paid for, the cash value will equal the face amount at age 100. -
ANS-How can you buy a whole life insurance policy?
1. Offer: A concise statement that is answered by Yes or No. In life insurance, an application is
only an offer if it comes with the first premium.
2. Acceptance: Mirror image of the offer. The company must issue and deliver the policy by the
agent.
3. Consideration: The exchange of something of value. Company offers promises and applicant
gives premium.
4. Capacity: Ability to enter into the contract
,5. Purpose: Reason for existence. In life, the applicant must have insurable interest and consent
in the life of the proposed insured. - ANS-What are the five elements of a contract?
1. Take the Money
2. Buy an Annuity Certain (A guaranteed income for a specific period of time)
3. A Life Annuity (Guaranteed income for life) - ANS-What three choices does an annuitant have
when the annuity reaches annuitization?
1. Terminally ill
2. Extraordinary Medical Intervention (organ transplant, artificial life support, etc.)
3. Permanently Institutionalized
4. Limits the Insured's life span (Heart disease, cancer, renal failure)
5. Any other condition approved by the Commissioner - ANS-In order to qualify for Accelerated
Death Benefits, the insured must be in what kind of circumstance?
1. Valued Contracts: They have a pre-determined, face amount. When Joe dies, his family will
receive the death benefit placed on the contract.
2. Reimbursement/indemnity contracts: Exist to make you whole. Brings you back to where you
were before something bad happened to you.
3. Service contracts: The carrier/company provides the service. - ANS-What are the different
types of insurance contracts?
20% of total earned income
Maximum annual contributions are limited to the lesser of $30,000 or 20 percent of total earned
income (25% of the after-contribution income). - ANS-A Keogh plan would allow an annual
contribution of up to
a. 20 percent of total earned income.
b. 10 percent of total earned income.
c. 15 percent of total earned income.
d. 30 percent of total earned income.
24 Hours of Continuing Education - ANS-A full lines Producer renewing a two year license must
have
a. 24 Hours of Continuing education
b. 10 Hours of Continuing education.
c. 15 Hours of Continuing education.
d. 30 Hours of Continuing education
31 Days: Normal Conversion Period
,15 Days: Extension
60 Days: Maximum Conversion Period - ANS-Explain the conversion summary for the State of
Indiana for Group insurance policies
A Death Benefit
Annuities are all about the accumulation of cash, not death benefits, and the money does grow
on a tax deferred basis. And it's Randy that doesn't have a clue. - ANS-Annuities don't have
a. Cash value.
b. Tax deferred growth.
c. A death benefit.
d. A clue.
A life insurance policy whose face amount jumps five times when the insured reaches a certain
age, such as 21. - ANS-Jumping Juvenile is
a. A hyperactive condition.
b. A Life insurance policy designed for adolescents who participate in track and field events.
c. A Life insurance policy whose face amount jumps five times when the insured reaches a
certain age, such as age 21.
d. A Life insurance policy whose premium jumps five times when the insured reaches a certain
age, such as age 21.
A Modified Endowment Contract - ANS-A life insurance policy that has cash value which grows
faster than the cash value of a Seven Pay Whole Life policy is known as
a. An Endowment policy.
b. Modified Life policy.
c. A Modified Endowment Contract.
d. A Modified Superstock Pro.
A person selling limited health policies (such as cancer insurance) to church members - ANS-All
of the following may obtain a limited insurance Producer's license EXCEPT
a. A person selling limited health policies (such as cancer insurance) to church members.
b. A person selling travel accident insurance in a transportation terminal.
c. A person selling title insurance to the purchaser of real estate.
d. A person selling baggage insurance in a transportation terminal
A producer changes their telephone number - ANS-The Commissioner must be notified in all of
the following circumstances EXCEPT:
a. A Producer changes their telephone number.
, b. A Producer is discharged for cause by an insurance company.
c. A Producer changes their business address
d. A Producer changes their residential address.
a single contract that covers a number of lives. The debtor is the insured and the creditor is the
owner/beneficiary. If you leave the group, you are no longer eligible to have the insurance. You
have 31 days to convert to an individual policy to maintain the insurance. The premium will be
based upon the attained age at time of the conversion. Death during the conversion period will
result in the same way as death while a member of the group. - ANS-What is group life
insurance?
A single contract that covers everybody in the family. You receive a whole life policy on the
breadwinner and convertible term on the rest. The basic term is life of the breadwinner. After the
death of the breadwinner, the family can convert to individual policies. New born children are
automatically covered with no proof of insurability and no increase in premium. - ANS-What is a
family life insurance policy?
A Whole Life policy with cash value - ANS-Which of the following life policies would provide
reinstatement rights?
a. Decreasing Term
b. A Whole Life policy with cash value
c. Renewable Term
d. All Term policies
A. $200,000 less any outstanding loans - ANS-In the year 2000, Hamlet purchased a $200,000
face amount Adjustable Life policy containing a conventional Suicide clause. If Hamlet commits
suicide in the year 2008, his company will pay which of the following?
a. $200,000 less any outstanding loans
b. The premium paid less any outstanding loans
c. $200,000 plus the cash value at Hamlet's death minus any outstanding loans
d. The cash value less any outstanding loans
A. $96,000 - ANS-Joel owns a $100,000 face amount Whole Life policy which has a cash value
of $11,000. There is also an outstanding loan of $4,000. If Joel dies, how much would the
insurance company pay to his beneficiary?
a. $96,000
b. $100,000
c. $111,000
d. $107,000
- ANS-Under the Unfair Competition Statute
a. Financial institutions may require insurance on the lives of debtors.
b. Premiums may not be based upon the age or gender of an applicant.
c. Participating policies must guarantee dividends.
d. Rebates may be paid to consumers, if it is in "the public interest."
. It is the same as a Modified Life Policy - ANS-Which of the following statements is NOT true
about Enhanced Ordinary Life?
a. It is the same as a Modified Life policy.
b. It is a combination of continuous premium Whole Life and Renewable Term.
c. Policy dividends are used to purchase Paid Up Additions.
d. It is only available on Participating Life insurance policies.
$25,000 - ANS-If the Commissioner issues a cease-and-desist order and you continue the same
activities, you can be fined up to which of the following amounts per violation of that order?
a. $5,000
b. $1,000
c. $50,000
d. $25,000
1. A Single Premium
2. Limited Pay (For a limited period of time)
3. Straight Life (Continuous) Premium
The shorter the payment period, the higher each individual payment but the lower the total cost.
The longer the payment period, the smaller the individual premiums, but the greater the total
cost. No matter how it's paid for, the cash value will equal the face amount at age 100. -
ANS-How can you buy a whole life insurance policy?
1. Offer: A concise statement that is answered by Yes or No. In life insurance, an application is
only an offer if it comes with the first premium.
2. Acceptance: Mirror image of the offer. The company must issue and deliver the policy by the
agent.
3. Consideration: The exchange of something of value. Company offers promises and applicant
gives premium.
4. Capacity: Ability to enter into the contract
,5. Purpose: Reason for existence. In life, the applicant must have insurable interest and consent
in the life of the proposed insured. - ANS-What are the five elements of a contract?
1. Take the Money
2. Buy an Annuity Certain (A guaranteed income for a specific period of time)
3. A Life Annuity (Guaranteed income for life) - ANS-What three choices does an annuitant have
when the annuity reaches annuitization?
1. Terminally ill
2. Extraordinary Medical Intervention (organ transplant, artificial life support, etc.)
3. Permanently Institutionalized
4. Limits the Insured's life span (Heart disease, cancer, renal failure)
5. Any other condition approved by the Commissioner - ANS-In order to qualify for Accelerated
Death Benefits, the insured must be in what kind of circumstance?
1. Valued Contracts: They have a pre-determined, face amount. When Joe dies, his family will
receive the death benefit placed on the contract.
2. Reimbursement/indemnity contracts: Exist to make you whole. Brings you back to where you
were before something bad happened to you.
3. Service contracts: The carrier/company provides the service. - ANS-What are the different
types of insurance contracts?
20% of total earned income
Maximum annual contributions are limited to the lesser of $30,000 or 20 percent of total earned
income (25% of the after-contribution income). - ANS-A Keogh plan would allow an annual
contribution of up to
a. 20 percent of total earned income.
b. 10 percent of total earned income.
c. 15 percent of total earned income.
d. 30 percent of total earned income.
24 Hours of Continuing Education - ANS-A full lines Producer renewing a two year license must
have
a. 24 Hours of Continuing education
b. 10 Hours of Continuing education.
c. 15 Hours of Continuing education.
d. 30 Hours of Continuing education
31 Days: Normal Conversion Period
,15 Days: Extension
60 Days: Maximum Conversion Period - ANS-Explain the conversion summary for the State of
Indiana for Group insurance policies
A Death Benefit
Annuities are all about the accumulation of cash, not death benefits, and the money does grow
on a tax deferred basis. And it's Randy that doesn't have a clue. - ANS-Annuities don't have
a. Cash value.
b. Tax deferred growth.
c. A death benefit.
d. A clue.
A life insurance policy whose face amount jumps five times when the insured reaches a certain
age, such as 21. - ANS-Jumping Juvenile is
a. A hyperactive condition.
b. A Life insurance policy designed for adolescents who participate in track and field events.
c. A Life insurance policy whose face amount jumps five times when the insured reaches a
certain age, such as age 21.
d. A Life insurance policy whose premium jumps five times when the insured reaches a certain
age, such as age 21.
A Modified Endowment Contract - ANS-A life insurance policy that has cash value which grows
faster than the cash value of a Seven Pay Whole Life policy is known as
a. An Endowment policy.
b. Modified Life policy.
c. A Modified Endowment Contract.
d. A Modified Superstock Pro.
A person selling limited health policies (such as cancer insurance) to church members - ANS-All
of the following may obtain a limited insurance Producer's license EXCEPT
a. A person selling limited health policies (such as cancer insurance) to church members.
b. A person selling travel accident insurance in a transportation terminal.
c. A person selling title insurance to the purchaser of real estate.
d. A person selling baggage insurance in a transportation terminal
A producer changes their telephone number - ANS-The Commissioner must be notified in all of
the following circumstances EXCEPT:
a. A Producer changes their telephone number.
, b. A Producer is discharged for cause by an insurance company.
c. A Producer changes their business address
d. A Producer changes their residential address.
a single contract that covers a number of lives. The debtor is the insured and the creditor is the
owner/beneficiary. If you leave the group, you are no longer eligible to have the insurance. You
have 31 days to convert to an individual policy to maintain the insurance. The premium will be
based upon the attained age at time of the conversion. Death during the conversion period will
result in the same way as death while a member of the group. - ANS-What is group life
insurance?
A single contract that covers everybody in the family. You receive a whole life policy on the
breadwinner and convertible term on the rest. The basic term is life of the breadwinner. After the
death of the breadwinner, the family can convert to individual policies. New born children are
automatically covered with no proof of insurability and no increase in premium. - ANS-What is a
family life insurance policy?
A Whole Life policy with cash value - ANS-Which of the following life policies would provide
reinstatement rights?
a. Decreasing Term
b. A Whole Life policy with cash value
c. Renewable Term
d. All Term policies
A. $200,000 less any outstanding loans - ANS-In the year 2000, Hamlet purchased a $200,000
face amount Adjustable Life policy containing a conventional Suicide clause. If Hamlet commits
suicide in the year 2008, his company will pay which of the following?
a. $200,000 less any outstanding loans
b. The premium paid less any outstanding loans
c. $200,000 plus the cash value at Hamlet's death minus any outstanding loans
d. The cash value less any outstanding loans
A. $96,000 - ANS-Joel owns a $100,000 face amount Whole Life policy which has a cash value
of $11,000. There is also an outstanding loan of $4,000. If Joel dies, how much would the
insurance company pay to his beneficiary?
a. $96,000
b. $100,000
c. $111,000
d. $107,000
