COLORADO INSURANCE EXAM-
LIFE QUESTIONS WITH A GRADED
SOLUTIONS
What's NOT a legal example of insurable interest? - Answer-STOLI agreement
Failing to adopt and implement reasonable standards for settling claims.
Failing to acknowledge pertinent communication pertaining to a claim.
Refusing to pay claims without conducting a reasonable investigation. - Answer-Unfair
claims settlement practices
The Governor has asked the Commissioner to examine an insurance company after a
group of insureds has filed several complaints against the company. Who will pay for
this examination? - Answer-The Insurance Company
The individual has earned the designation from a for-profit organization is an example of
- Answer-individuals when using senor-specific designations
Believing a producer has violated provisions of the Insurance Code, the Commissioner
will schedule a hearing - Answer-to allow the producer to show why the penalties should
not be assessed
The regulations regarding replacement apply to - Answer-renewable term
Issuing sales material with exaggerated statements about policy benefits is an example
of - Answer-misrepresentation
A licensee has met licensing qualifications for Life, Health, Property, and Casualty
insurance. How many separate licenses will the Department of Insurance issue? -
Answer-1
Who is responsible for covering the expenses associated with the examination of
domestic insurers? - Answer-the examined insurer
Collecting interest on customer balances held in a producer's trust account is an
example of - Answer-using fiduciary funds
All insurers that terminate employment with a producer are required to notify the
Commissioner within how many days following the effective date of the termination? -
Answer-30 days
, rebating, defamation, and boycotting are examples of - Answer-unfair trade practices in
the business of insurance
How long is the free-look period for life insurance policies issued in Colorado? - Answer-
15 days
Equity indexed annuities - Answer-seek higher returns
Third-party ownership - Answer-appropriate for a parent buying a life insurance policy
on a child where the parent is the policyowner
An insured buys a 5-year level premium term policy with a face amount of $10,000. The
policy also contains renewability and convertibility options. When the insured renews
the policy in 5 years, what will happen to the premium? - Answer-it will increase
because the insured will be 5 years older than when the policy was originally purchased
An applicant is denied insurance because of information found on a consumer report.
Which of the following requires that the insurance company supply the applicant with
the name and address of the consumer reporting company? - Answer-Fair Credit
Reporting Act
taxation of premiums in a key-person life insurance policy..... - Answer-Premiums are
not tax deductible as a business expense.
Premiums are not tax deductible as a business expense. - Answer-separate accounts
Annually renewable term policies provide a level death benefit for a premium that -
Answer-increases annually
Life income joint and survivor settlement option guarantees - Answer-income for 2 or
more recipients until they die
A rider attached to a life insurance policy that provides coverage on the insured's family
members is called the - Answer-other insured rider
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel
his policy and exercise the extended term option for the policy's cash value, which is
currently $20,000. What would be the face amount of the new term policy? - Answer-
50,000$
It requires the policyowner to pay all overdue premiums with interest before the policy is
reinstated is what provision? - Answer-reinstatement provision
An insured is diagnosed with cancer and needs help paying for her medical treatment
would qualify them for what kind of benefits? - Answer-accelerated
LIFE QUESTIONS WITH A GRADED
SOLUTIONS
What's NOT a legal example of insurable interest? - Answer-STOLI agreement
Failing to adopt and implement reasonable standards for settling claims.
Failing to acknowledge pertinent communication pertaining to a claim.
Refusing to pay claims without conducting a reasonable investigation. - Answer-Unfair
claims settlement practices
The Governor has asked the Commissioner to examine an insurance company after a
group of insureds has filed several complaints against the company. Who will pay for
this examination? - Answer-The Insurance Company
The individual has earned the designation from a for-profit organization is an example of
- Answer-individuals when using senor-specific designations
Believing a producer has violated provisions of the Insurance Code, the Commissioner
will schedule a hearing - Answer-to allow the producer to show why the penalties should
not be assessed
The regulations regarding replacement apply to - Answer-renewable term
Issuing sales material with exaggerated statements about policy benefits is an example
of - Answer-misrepresentation
A licensee has met licensing qualifications for Life, Health, Property, and Casualty
insurance. How many separate licenses will the Department of Insurance issue? -
Answer-1
Who is responsible for covering the expenses associated with the examination of
domestic insurers? - Answer-the examined insurer
Collecting interest on customer balances held in a producer's trust account is an
example of - Answer-using fiduciary funds
All insurers that terminate employment with a producer are required to notify the
Commissioner within how many days following the effective date of the termination? -
Answer-30 days
, rebating, defamation, and boycotting are examples of - Answer-unfair trade practices in
the business of insurance
How long is the free-look period for life insurance policies issued in Colorado? - Answer-
15 days
Equity indexed annuities - Answer-seek higher returns
Third-party ownership - Answer-appropriate for a parent buying a life insurance policy
on a child where the parent is the policyowner
An insured buys a 5-year level premium term policy with a face amount of $10,000. The
policy also contains renewability and convertibility options. When the insured renews
the policy in 5 years, what will happen to the premium? - Answer-it will increase
because the insured will be 5 years older than when the policy was originally purchased
An applicant is denied insurance because of information found on a consumer report.
Which of the following requires that the insurance company supply the applicant with
the name and address of the consumer reporting company? - Answer-Fair Credit
Reporting Act
taxation of premiums in a key-person life insurance policy..... - Answer-Premiums are
not tax deductible as a business expense.
Premiums are not tax deductible as a business expense. - Answer-separate accounts
Annually renewable term policies provide a level death benefit for a premium that -
Answer-increases annually
Life income joint and survivor settlement option guarantees - Answer-income for 2 or
more recipients until they die
A rider attached to a life insurance policy that provides coverage on the insured's family
members is called the - Answer-other insured rider
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel
his policy and exercise the extended term option for the policy's cash value, which is
currently $20,000. What would be the face amount of the new term policy? - Answer-
50,000$
It requires the policyowner to pay all overdue premiums with interest before the policy is
reinstated is what provision? - Answer-reinstatement provision
An insured is diagnosed with cancer and needs help paying for her medical treatment
would qualify them for what kind of benefits? - Answer-accelerated
