LIFE PRODUCER EXAM (MI) || WITH ERROR-FREE
ANSWERS.
Which of the following is NOT true regarding a Certificate of Authority?
a)It may be necessary for transacting business in a specific state.
b)It is equivalent to an insurance license.
c)It is issued by the state department of insurance.
d)It is issued to group insurance participants. correct answers d) It is issued to group insurance
participants.
Before insurers may transact business in a specific state, they must apply for a license or
Certificate of Authority from the state department of insurance and meet any financial (capital
and surplus) requirements set down by the state.
If an insured changes his payment plan from monthly to annually, what happens to the total
premium?
a)Doubles
b)Increases
c)Decreases
d)Stays the same correct answers c) Decreases
Because the insurer would have the entire premium to invest for a full year, they would reduce
the premium amount.
To sell variable life insurance policies, an agent must receive all of the following EXCEPT
a)A life insurance license.
, b)SEC registration.
c)FINRA registration
.d)A securities license. correct answers b) The owner will receive the surrender value of the
annuity.
If a deferred annuity is surrendered prior to annuitization, the surrender value of the annuity is
guaranteed according to the nonforfeiture provision.
What happens if a deferred annuity is surrendered before the annuitization period?
a)Deferred annuities cannot be surrendered prior to the annuitization period.
b)The owner will receive the surrender value of the annuity.
c)The owner will only receive a refund of premium.
d)The insurer can only apply the surrender value toward another annuity. correct answers b) The
owner will receive the surrender value of the annuity.
If a deferred annuity is surrendered prior to annuitization, the surrender value of the annuity is
guaranteed according to the nonforfeiture provision.
What is the maximum fine for submitting a false or fraudulent claim to the insurer?
a)$500
b)$1,000
c)$1,500
d)$2,000 correct answers b) 1,000
If convicted for a false claim, an insured, agent, collector, physician or any other person could be
fined up to $1,000.
ANSWERS.
Which of the following is NOT true regarding a Certificate of Authority?
a)It may be necessary for transacting business in a specific state.
b)It is equivalent to an insurance license.
c)It is issued by the state department of insurance.
d)It is issued to group insurance participants. correct answers d) It is issued to group insurance
participants.
Before insurers may transact business in a specific state, they must apply for a license or
Certificate of Authority from the state department of insurance and meet any financial (capital
and surplus) requirements set down by the state.
If an insured changes his payment plan from monthly to annually, what happens to the total
premium?
a)Doubles
b)Increases
c)Decreases
d)Stays the same correct answers c) Decreases
Because the insurer would have the entire premium to invest for a full year, they would reduce
the premium amount.
To sell variable life insurance policies, an agent must receive all of the following EXCEPT
a)A life insurance license.
, b)SEC registration.
c)FINRA registration
.d)A securities license. correct answers b) The owner will receive the surrender value of the
annuity.
If a deferred annuity is surrendered prior to annuitization, the surrender value of the annuity is
guaranteed according to the nonforfeiture provision.
What happens if a deferred annuity is surrendered before the annuitization period?
a)Deferred annuities cannot be surrendered prior to the annuitization period.
b)The owner will receive the surrender value of the annuity.
c)The owner will only receive a refund of premium.
d)The insurer can only apply the surrender value toward another annuity. correct answers b) The
owner will receive the surrender value of the annuity.
If a deferred annuity is surrendered prior to annuitization, the surrender value of the annuity is
guaranteed according to the nonforfeiture provision.
What is the maximum fine for submitting a false or fraudulent claim to the insurer?
a)$500
b)$1,000
c)$1,500
d)$2,000 correct answers b) 1,000
If convicted for a false claim, an insured, agent, collector, physician or any other person could be
fined up to $1,000.
