NC LIFE INSURANCE EXAM 2025/2026/ACTUAL COMPLTE
REAL EXAM QUESTIONS AND WELL ELABORATED ANSWERS
WITH RATIONALES (VERIFIED ANSWERS) /LATEST VERSION
/GRADE A+ ASSURED !!
Which of the following determines the cash value of a variable
life policy?
a)The company's general account
b)The policy's guarantees.
c)The premium mode
d)The performance of the policy portfolio - ANSWER-d)The
performance of the policy portfolio
The cash value of a variable life policy is not guaranteed and
fluctuates with the performance of the portfolio in which the
premiums have been invested by the insurer.
All of following are true of annually renewable term insurance
EXCEPT
a). The death benefit remains level
,b). The policy must be renewed no matter what happens to
one's health
c). Proof of insurability must be provided at each renewal
d). The premium increases each year - ANSWER-c). Proof of
insurability must be provided at each renewal
ART is a form of level term insurance, in which the death
benefit remains level and the policy may be guaranteed to be
renewable each year without proof of insurability, but the
premium increases annually according to the insured's attained
age.
What type of an interest rate is guaranteed in universal life
policies
a). Adjustable interest rate
b). Current interest rate
c). Contract interest rate
d). Nominal interest rate - ANSWER-c). Contract interest rate
The insurer guarantees a contract interest rate. A current
interest rate is not guaranteed in the contract and may be
higher because of current market conditions
,All are true regarding the Insurance Commissioner's power
related to hearings and investigations EXCEPT
a). The Commissioner must examine every domestic insurer at
least once every
5 years
b). If the Commissioner finds that there is sufficient evidence to
charge a person with a criminal violation, he or she may have
the person arrested
c. The Commissioner may hold hearing immediately after
determining that a violation has occurred.
d). The Commissioner may examine the affairs of anyone
involved in the insurance industry - ANSWER-c. The
Commissioner may hold hearing immediately after determining
that a violation has occurred.
The Commissioner must give 10 days written notice of all
hearings
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.
Under which of the following conditions would life insurance
proceeds are taxable by the federal government?
a). If collaterally assigned to the lender
b). If taken as a lump sum
c). If paid to the policyowner
d). If there is a transfer for value - ANSWER-d). If there is a
transfer for value
If life insurance proceeds are collected in a lump-sum payment,
they are generally not subject to federal taxation. If the benefit
payment results in a transfer of value (if the policy is sold to
another person), it may not be exempt from taxation. Transfer
REAL EXAM QUESTIONS AND WELL ELABORATED ANSWERS
WITH RATIONALES (VERIFIED ANSWERS) /LATEST VERSION
/GRADE A+ ASSURED !!
Which of the following determines the cash value of a variable
life policy?
a)The company's general account
b)The policy's guarantees.
c)The premium mode
d)The performance of the policy portfolio - ANSWER-d)The
performance of the policy portfolio
The cash value of a variable life policy is not guaranteed and
fluctuates with the performance of the portfolio in which the
premiums have been invested by the insurer.
All of following are true of annually renewable term insurance
EXCEPT
a). The death benefit remains level
,b). The policy must be renewed no matter what happens to
one's health
c). Proof of insurability must be provided at each renewal
d). The premium increases each year - ANSWER-c). Proof of
insurability must be provided at each renewal
ART is a form of level term insurance, in which the death
benefit remains level and the policy may be guaranteed to be
renewable each year without proof of insurability, but the
premium increases annually according to the insured's attained
age.
What type of an interest rate is guaranteed in universal life
policies
a). Adjustable interest rate
b). Current interest rate
c). Contract interest rate
d). Nominal interest rate - ANSWER-c). Contract interest rate
The insurer guarantees a contract interest rate. A current
interest rate is not guaranteed in the contract and may be
higher because of current market conditions
,All are true regarding the Insurance Commissioner's power
related to hearings and investigations EXCEPT
a). The Commissioner must examine every domestic insurer at
least once every
5 years
b). If the Commissioner finds that there is sufficient evidence to
charge a person with a criminal violation, he or she may have
the person arrested
c. The Commissioner may hold hearing immediately after
determining that a violation has occurred.
d). The Commissioner may examine the affairs of anyone
involved in the insurance industry - ANSWER-c. The
Commissioner may hold hearing immediately after determining
that a violation has occurred.
The Commissioner must give 10 days written notice of all
hearings
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.
Under which of the following conditions would life insurance
proceeds are taxable by the federal government?
a). If collaterally assigned to the lender
b). If taken as a lump sum
c). If paid to the policyowner
d). If there is a transfer for value - ANSWER-d). If there is a
transfer for value
If life insurance proceeds are collected in a lump-sum payment,
they are generally not subject to federal taxation. If the benefit
payment results in a transfer of value (if the policy is sold to
another person), it may not be exempt from taxation. Transfer
