NJ LIFE INSURANCE EXAM PRACTICE
Questions and Answers
1. 1) The full premium was submitted with the application for
life insurance, & the policy was issued 2 weeks later as
requested. When does the policy coverage become effective?
a) As of policy delivery date
b) As of the first of the month after the policy issue
c)As of the policy issue date
d) As of the application date
ANS d) As of the application date
2. 2) Which of the following is true regarding license cancellation
and reinstate- ment?
a)The producer must allow it to lapse. After that point, it can be
reinstated any time within the next 2 years, provided that the
continuing education require- ments have been met
b) The license needs to be returned to the Insurance Department.
Once this occurs, it cannot be reinstated
c)The producer must complete a brief interview with the
Commissioner's Office. The license may then be reinstate within
1 year
d) The license needs to be returned to the Insurance Department. It
,can be reinstated by filling out an application and paying a fee
ANS d) The license needs to be returned to the Insurance Department. It can be reinstated
by filling out an application and paying a fee
3. 3) On its advertisement, a company claims that it has funds in its
possession that are, in fact, not available for the payment of losses or
claims. The company is guilty of
a) Twisting
b) Defamation
c)Misrepresentation
d) Coercion
ANS c) Misrepresentation
4. 4) The Waiver of Cost rider is found in what type of insurance?
a) Joint and Survivor
b) Juvenile Life
c)Universal Life
d) Whole Life
ANS c) Universal Life
5. 5) Which rule would apply if an agent knows an applicant is going
to cash in an old policy and use the funds to purchase new
insurance?
a) Replacement rule
, b) Reinstatement rule
c)Conversion rule
d) Disclosure rule
ANS a) Replacement rule
6. 6) A contract between a producer and an insurance company
a) Is considered noncancellable
b) Must be in writing and signed by both parties
c)Can be in writing or a verbal agreement
d) Must be signed by at least one party
ANS b) Must be in writing and signed by both parties
7. 7) Which of the following explains the policy owner's right to
change benefi- ciaries, choose options, and receive proceeds of a
policy?
a) The Entire Contract Provision
b) The Consideration Clause
c)Assignment Rights
d) Owner's Rights
ANS d) Owner's Rights
8. 8) What significance did Paul vs. Virginia have on the insurance
industry?
Questions and Answers
1. 1) The full premium was submitted with the application for
life insurance, & the policy was issued 2 weeks later as
requested. When does the policy coverage become effective?
a) As of policy delivery date
b) As of the first of the month after the policy issue
c)As of the policy issue date
d) As of the application date
ANS d) As of the application date
2. 2) Which of the following is true regarding license cancellation
and reinstate- ment?
a)The producer must allow it to lapse. After that point, it can be
reinstated any time within the next 2 years, provided that the
continuing education require- ments have been met
b) The license needs to be returned to the Insurance Department.
Once this occurs, it cannot be reinstated
c)The producer must complete a brief interview with the
Commissioner's Office. The license may then be reinstate within
1 year
d) The license needs to be returned to the Insurance Department. It
,can be reinstated by filling out an application and paying a fee
ANS d) The license needs to be returned to the Insurance Department. It can be reinstated
by filling out an application and paying a fee
3. 3) On its advertisement, a company claims that it has funds in its
possession that are, in fact, not available for the payment of losses or
claims. The company is guilty of
a) Twisting
b) Defamation
c)Misrepresentation
d) Coercion
ANS c) Misrepresentation
4. 4) The Waiver of Cost rider is found in what type of insurance?
a) Joint and Survivor
b) Juvenile Life
c)Universal Life
d) Whole Life
ANS c) Universal Life
5. 5) Which rule would apply if an agent knows an applicant is going
to cash in an old policy and use the funds to purchase new
insurance?
a) Replacement rule
, b) Reinstatement rule
c)Conversion rule
d) Disclosure rule
ANS a) Replacement rule
6. 6) A contract between a producer and an insurance company
a) Is considered noncancellable
b) Must be in writing and signed by both parties
c)Can be in writing or a verbal agreement
d) Must be signed by at least one party
ANS b) Must be in writing and signed by both parties
7. 7) Which of the following explains the policy owner's right to
change benefi- ciaries, choose options, and receive proceeds of a
policy?
a) The Entire Contract Provision
b) The Consideration Clause
c)Assignment Rights
d) Owner's Rights
ANS d) Owner's Rights
8. 8) What significance did Paul vs. Virginia have on the insurance
industry?
