Texas Life Insurance exam Questions and Answer well revised

Texas Life Insurance exam Questions and Answer well revised Insurance (General concept) - correct answers-- transfers the risk of loss from an individual to an insurer - based on the principle of indemnity - based on the principle of risk (risk pooling) insurable interest (General Concept) - correct answers-- must exist at the time of the application - insuring one's own life, family member, or a business partner Solicitation and sales presentation - correct answers-- illustration- presentation of nonguaranteed elements - buyer's guide is generic information about life polices which must be provided at the time of application - policy summary is a description of features and benefits of the policy being issued and must be provided when the policy is delivered. Underwriting (Field underwriting (by agent) - correct answers-- application completed and signed - agent's report: agent's observation about the application that can assist in underwriting -premiums with application and conditional receipts underwriting ( company underwriting) - correct answers-- multiple sources of information: applications, consumer reports, MIB (Medical Information Burea) - Risk Classification: 3 types of risk : standard, substandard, preferred Underwriting (Federal Regulation) - correct answers-- Fair Credit Reporting Act: protect consumers against circulations of inaccurate or obsolete information - USE PATRIOT Act/ Anti-money Laundering and Suspicious Activity Reports Rules Premium Determination - correct answers-- 3 key Factors for life insurance: mortality, interest, and expense - Mode: the more frequently premium is paid, the higher the premium Policy Issue and Delivery - correct answers-Effective date of coverage - if the premium is not paid with the application, the agent must obtain the premium and a statement of continued good health at the time of the policy delivery Agent/ Producer - correct answers-a legal representative of an insurance company; the classification of producers usually includes agents and brokers' agents are the agents of the insurer Applicant of proposed insured - correct answers-a person applying for insurance Beneficiary - correct answers-a person who receives the benefits of an insurance policy Broker - correct answers-an insurance producer who is not appointed by an insurance company and who represents the client Death benefits - correct answers-the amount paid upon death of the insured in a life insurance policy Estate - correct answers-a person's net worth Insurance policy - correct answers-a contact between a policyowner (and/or insured) and an insurance company which agrees to pay insured or the beneficiary for loss caused by specific events. Insured - correct answers-a person covered by the insurance policy; may or may not be the policyowner insurer (principal) - correct answers-the company who issues an insurance policy Lapse - correct answers-policy termination due to nonpayment of premium Life insurance - correct answers-coverage on human lives Policyowner - correct answers-the person entitled to exercise the rights and privileges in the policy Premium - correct answers-the money paid to the insurance company for the insurance policy Underwriting - correct answers-is the risk selection and classification process Attained age - correct answers-the insured's age at the time the policy is issued or renewed cash value - correct answers-a policy's saving element or living benefit Face amount - correct answers-the amount of benefits stated in the life insurance policy Fixed life insurance - correct answers-contracts that offer guaranteed minimum or fixed benefits Deferred - correct answers-withheld or postponed until a specified time or event in the future