NC LIFE INSURANCE EXAM QUESTIONS & ANSWERS
Which of the following is an eligibility requirement for all social security disability income
benefits - Answers - Have attained fully insured status
If the Commissioner denies an initial application for an agent, how long does the
applicant have to request a review after receiving notification of the denial? - Answers -
30 days
Traditional IRA contributions are tax deductible based on which of the following? -
Answers - Owners income
Which of the following will NOT be considered unfair discrimination by insurers? -
Answers - Discriminating in benefits and coverages based on the insured's habits and
lifestyle
How long must a complaint record be maintained? - Answers - 5 years
How must a replacing producer respond to an applicant wishing to replace existing life
insurance? - Answers - The producer must provide the applicant with a Notice
Regarding Replacement.
Which of the following statements would best describe the different between vatical
settlements and accelerated death benefits? - Answers - Viaticals are funded by a third
party; accelerated death benefits are provided by the insurer that issued the original
policy
An agent and an applicant for a life insurance policy fill out and sign the application.
However, the applicant does not wish to give the agent the initial premium, no
conditional receipt is issued. When will coverage begin? - Answers - When the agent
delivers the policy, collects the initial premium, and the applicant completes an
acceptable Statement of Good Health
Which rule would apply if an agent knows an applicant is going to case in an old policy
and use the funds to purchase new insurance? - Answers - Replacement rule
Which of the following will NOT be an appropriate use of a deferred annuity? - Answers
- Creating an estate
Which of the following ultimately determines the interest rates paid to the owner of a
fixed annuity? - Answers - Insurer's guaranteed minimum rate of interest
If an insurer becomes insolvent, which of the following would pay benefits to
policyholders? - Answers - The Guaranty Association
, How are state insurance Guaranty Associations funded? - Answers - By their members
- authorized insurers
Which option is being utilized when the insurer accumulates, dividends at interest and
then uses the accumulated dividends, plus interest, and the policy cash value to pay the
policy up early? - Answers - Paid-up option
In which of the following situations is it legal to limit coverage based on marital status? -
Answers - It is never legal to limit covered based on marital status
To attain currently insured status under Social Security, a worker must have earned at
least how many credits during the last 13 quarters? - Answers - 6 credits
A corporation is the owner and beneficiary of the key person life policy. If the
corporation collects the policy benefit, then - Answers - The benefit is received tax free
Which type of life insurance policy allows the policy owner to pay more or less than the
planned premium? - Answers - Universal life
What are the two components of a universal policy? - Answers - Insurance and cash
account
A viatical settlement is arranged between a viatical company and a/an - Answers -
Terminally ill insured
Which of the following terms is used to name the non taxed return of unused premiums?
- Answers - Dividends
Under which installments option does the annuitant select the amount of each payment,
and the insurer determines how long they will pay benefits? - Answers - Fixed amount
Your clients wants both protection and savings from the insurance and is willing to pay
premiums until retirement at age 65. What would be the right policy for this client? -
Answers - Limited pay whole life
Concerning Juvenile Life insurance, which of the following statements is INCORRECT?
- Answers - Juvenile Life is classified as any life insurance purchased by a minor.
Variable Whole Life insurance is based on what type of premium? - Answers - Level
fixed
Which of the following statements is TRUE concerning the Accidental Death Rider? -
Answers - It will pay double or triple the face amount.
Which of the following is an eligibility requirement for all social security disability income
benefits - Answers - Have attained fully insured status
If the Commissioner denies an initial application for an agent, how long does the
applicant have to request a review after receiving notification of the denial? - Answers -
30 days
Traditional IRA contributions are tax deductible based on which of the following? -
Answers - Owners income
Which of the following will NOT be considered unfair discrimination by insurers? -
Answers - Discriminating in benefits and coverages based on the insured's habits and
lifestyle
How long must a complaint record be maintained? - Answers - 5 years
How must a replacing producer respond to an applicant wishing to replace existing life
insurance? - Answers - The producer must provide the applicant with a Notice
Regarding Replacement.
Which of the following statements would best describe the different between vatical
settlements and accelerated death benefits? - Answers - Viaticals are funded by a third
party; accelerated death benefits are provided by the insurer that issued the original
policy
An agent and an applicant for a life insurance policy fill out and sign the application.
However, the applicant does not wish to give the agent the initial premium, no
conditional receipt is issued. When will coverage begin? - Answers - When the agent
delivers the policy, collects the initial premium, and the applicant completes an
acceptable Statement of Good Health
Which rule would apply if an agent knows an applicant is going to case in an old policy
and use the funds to purchase new insurance? - Answers - Replacement rule
Which of the following will NOT be an appropriate use of a deferred annuity? - Answers
- Creating an estate
Which of the following ultimately determines the interest rates paid to the owner of a
fixed annuity? - Answers - Insurer's guaranteed minimum rate of interest
If an insurer becomes insolvent, which of the following would pay benefits to
policyholders? - Answers - The Guaranty Association
, How are state insurance Guaranty Associations funded? - Answers - By their members
- authorized insurers
Which option is being utilized when the insurer accumulates, dividends at interest and
then uses the accumulated dividends, plus interest, and the policy cash value to pay the
policy up early? - Answers - Paid-up option
In which of the following situations is it legal to limit coverage based on marital status? -
Answers - It is never legal to limit covered based on marital status
To attain currently insured status under Social Security, a worker must have earned at
least how many credits during the last 13 quarters? - Answers - 6 credits
A corporation is the owner and beneficiary of the key person life policy. If the
corporation collects the policy benefit, then - Answers - The benefit is received tax free
Which type of life insurance policy allows the policy owner to pay more or less than the
planned premium? - Answers - Universal life
What are the two components of a universal policy? - Answers - Insurance and cash
account
A viatical settlement is arranged between a viatical company and a/an - Answers -
Terminally ill insured
Which of the following terms is used to name the non taxed return of unused premiums?
- Answers - Dividends
Under which installments option does the annuitant select the amount of each payment,
and the insurer determines how long they will pay benefits? - Answers - Fixed amount
Your clients wants both protection and savings from the insurance and is willing to pay
premiums until retirement at age 65. What would be the right policy for this client? -
Answers - Limited pay whole life
Concerning Juvenile Life insurance, which of the following statements is INCORRECT?
- Answers - Juvenile Life is classified as any life insurance purchased by a minor.
Variable Whole Life insurance is based on what type of premium? - Answers - Level
fixed
Which of the following statements is TRUE concerning the Accidental Death Rider? -
Answers - It will pay double or triple the face amount.
