LIFE AND HEALTH
INSURANCE EXAM
K
C
QUESTIONS AND CORRECT
LO
VERIFIED ANSWERS 100%
GUARANTEED PASS A+
YC
GRADED
D
U
ST
,Concealment - ANS The intentional failure to disclose known facts on an insurance
application is called
$94,800 - ANS Betty owns a universal life insurance policy that was issued with a $100,000
face amount and now has total death benefit protection of $110,000. Several months ago she
borrowed $15,000 from the policy. The outstanding loan balance (Including Interest) is $15,200.
If Betty dies today, what will be the amount of the death benefit?
K
6 Months - ANS Life insurance policies sold or delivered in Michigan must not contain the
provision that back dates the effective date of a policy any more than how many months?
C
Nonforfeiture Provision - ANS The privilege of accessing the cash value of an insurance
policy if it is surrendered is known as the
LO
Mortality - ANS Which of the following premium factors has the greatest effect on life
insurance premium calculations?
Who Issues Them - ANS Annuities are classified by all of the following EXCEPT
YC
Decreasing Term - ANS Joe buys his first home after obtaining a 30 year mortgage from his
bank. He is considering the purchase of life insurance to ensure that the mortgage will be paid
in the event of his death, in which case he will leave the house to his spouse and children. What
would be the best life insurance protection for Joe?
To provide for annuities to be payable in fixed or variable amounts or for variable life insurance -
D
ANS For which of the following reasons would a domestic insurer set up separate accounts?
Must have the application signed by the policyowner - ANS Which of the following statements
U
regarding the delivery of a life insurance policy is NOT correct?
$3.00 - ANS A producer must pay a fee of how much with each change of address?
ST
1 to 12 months - ANS Group life insurance policies include a probationary period requiring
new employees to wait a certain time before they can enroll in the plan. How long is the typical
range for these probationary periods?
$12,040 - ANS James died after receiving $180 per month for 6 years from a $25,000 life with
refund annuity. His spouse, Lucy, as his beneficiary, will now receive t he same monthly income
until her payments total
, 25% of the employee's income up to a specified maximum amount - ANS Contributions to a
simplified employee pension are not included in the employee's taxable income for the year as
long as the contribution does not exceed
Apparent Authority - ANS Susan is the receptionist at an insurance agency. She is currently
studying for her life insurance license. One day at lunchtime, Carla comes in the office to pay
her auto insurance premium. Susan talks to her about the importance of life insurance, and
Carla immediately completes an application and gives Susan a check for the premium. Carla
leaves the agency believing she is covered by life insurance. Susan has acted with
K
The proceed are payable to the insured's estate or the insured had any incidence of ownership
in the policy at time of death or transferred ownership within 3 years of death. - ANS Life
insurance proceeds are included in t he gross estate if
C
to replace an individual's economic value - ANS According to the principle of human life
value, the purpose of life insurance is
LO
24 hours with a minimum of 3 hours in ethics - ANS How many hours of continuing education
credit does an agent need to complete every two years?
Verify the applicant's military records, if any - ANS During the underwriting process, an
YC
insurer may do all of the following EXCEPT
The projected future earnings of the breadwinner and the number of years she expects to work -
ANS Which of the following is NOT taken into account when using the needs approach to
determine the proper amount of insurance protection?
D
A mutual insurance company - ANS An insurance company that is owned by its policyowners,
who share the insurer's divisible surplus in the form of participating policy dividends, is known as
U
The death benefit of $50,000 is not guaranteed. - ANS Michelle, age 31, just purchased a
$50,000 variable life insurance policy. Which of the following statements is NOT correct?
ST
loss must be intentional - ANS All of the following are characteristics of an insurable risk
EXCEPT
Life insurance that is owned by the insured will avoid estate tax inclusion as long as ownership
is transferred to another party at least 1 year before the insured's death. - ANS Which of the
following statements regarding the estate tax treatment of life insurance owned by the insured at
the insured's death is NOT correct?
Variable Life insurance cannot be proposed in sales situation unless the proposal is preceded or
accompanied by a prespectus. - ANS Which of the following statements pertaining to variable
life insurance is CORRECT?
INSURANCE EXAM
K
C
QUESTIONS AND CORRECT
LO
VERIFIED ANSWERS 100%
GUARANTEED PASS A+
YC
GRADED
D
U
ST
,Concealment - ANS The intentional failure to disclose known facts on an insurance
application is called
$94,800 - ANS Betty owns a universal life insurance policy that was issued with a $100,000
face amount and now has total death benefit protection of $110,000. Several months ago she
borrowed $15,000 from the policy. The outstanding loan balance (Including Interest) is $15,200.
If Betty dies today, what will be the amount of the death benefit?
K
6 Months - ANS Life insurance policies sold or delivered in Michigan must not contain the
provision that back dates the effective date of a policy any more than how many months?
C
Nonforfeiture Provision - ANS The privilege of accessing the cash value of an insurance
policy if it is surrendered is known as the
LO
Mortality - ANS Which of the following premium factors has the greatest effect on life
insurance premium calculations?
Who Issues Them - ANS Annuities are classified by all of the following EXCEPT
YC
Decreasing Term - ANS Joe buys his first home after obtaining a 30 year mortgage from his
bank. He is considering the purchase of life insurance to ensure that the mortgage will be paid
in the event of his death, in which case he will leave the house to his spouse and children. What
would be the best life insurance protection for Joe?
To provide for annuities to be payable in fixed or variable amounts or for variable life insurance -
D
ANS For which of the following reasons would a domestic insurer set up separate accounts?
Must have the application signed by the policyowner - ANS Which of the following statements
U
regarding the delivery of a life insurance policy is NOT correct?
$3.00 - ANS A producer must pay a fee of how much with each change of address?
ST
1 to 12 months - ANS Group life insurance policies include a probationary period requiring
new employees to wait a certain time before they can enroll in the plan. How long is the typical
range for these probationary periods?
$12,040 - ANS James died after receiving $180 per month for 6 years from a $25,000 life with
refund annuity. His spouse, Lucy, as his beneficiary, will now receive t he same monthly income
until her payments total
, 25% of the employee's income up to a specified maximum amount - ANS Contributions to a
simplified employee pension are not included in the employee's taxable income for the year as
long as the contribution does not exceed
Apparent Authority - ANS Susan is the receptionist at an insurance agency. She is currently
studying for her life insurance license. One day at lunchtime, Carla comes in the office to pay
her auto insurance premium. Susan talks to her about the importance of life insurance, and
Carla immediately completes an application and gives Susan a check for the premium. Carla
leaves the agency believing she is covered by life insurance. Susan has acted with
K
The proceed are payable to the insured's estate or the insured had any incidence of ownership
in the policy at time of death or transferred ownership within 3 years of death. - ANS Life
insurance proceeds are included in t he gross estate if
C
to replace an individual's economic value - ANS According to the principle of human life
value, the purpose of life insurance is
LO
24 hours with a minimum of 3 hours in ethics - ANS How many hours of continuing education
credit does an agent need to complete every two years?
Verify the applicant's military records, if any - ANS During the underwriting process, an
YC
insurer may do all of the following EXCEPT
The projected future earnings of the breadwinner and the number of years she expects to work -
ANS Which of the following is NOT taken into account when using the needs approach to
determine the proper amount of insurance protection?
D
A mutual insurance company - ANS An insurance company that is owned by its policyowners,
who share the insurer's divisible surplus in the form of participating policy dividends, is known as
U
The death benefit of $50,000 is not guaranteed. - ANS Michelle, age 31, just purchased a
$50,000 variable life insurance policy. Which of the following statements is NOT correct?
ST
loss must be intentional - ANS All of the following are characteristics of an insurable risk
EXCEPT
Life insurance that is owned by the insured will avoid estate tax inclusion as long as ownership
is transferred to another party at least 1 year before the insured's death. - ANS Which of the
following statements regarding the estate tax treatment of life insurance owned by the insured at
the insured's death is NOT correct?
Variable Life insurance cannot be proposed in sales situation unless the proposal is preceded or
accompanied by a prespectus. - ANS Which of the following statements pertaining to variable
life insurance is CORRECT?
