Michigan Life Insurance State Exam
Questions and Guide Answers
100% Verified Graded A+
1. Under a traditional IRA, interest is taxed
Only if withdrawn prior to age 59 1/2
According to the capital gains rate
Upon distribution
During the accumulation phase
Answer: Upon distribution
2. Which of these statements concerning Traditional IRAs is CORRECT?
Earnings are not taxable when withdrawn
Earnings are taxable when withdrawn
,Contribution are never tax deductible
Contributions are always made by the employer
Answer: Earnings are taxable when withdrawn
3. Which of these describes the result of a modified endowment contract that
failed to meet the seven- pay test?
Policy loans are disallowed
The premium payments will be tax deductible
Pre- death distributions are typically taxable
Withdrawals will be prohibited
Answer: Pre- death distributions are typically taxable
4. In order for a contract to be valid, it must
be filled with the state
be signing and witnessed by an attorney
,be in writing
contain offer and acceptance
Answer: Contain otter and acceptance
5. Which of the following actions is REQUIRED by a producer who is replacing
an existing life insurance policy?
Keep replacement records on file for at least 10 years
Notify the existing insurer of the proposed replacement
Submit to the replacing insurer a list of the policies to be replaced
Offer the insured a 60- day free- look period
Answer: Submit to the replacing insurer a list of the policies to be replaced
6. Who were Keogh plans designed to provide pension benefits for?
Corporate officers
Public school employees
The self-employed
Government employees
, Answer: The self emplyed
7. A producer's fiduciary duty requires that
premiums are maintained in a personal bank account until remittance to
insurer
premiums be deposited in an interest bearing account
premiums are forwarded to the insurer on a timely basis
premiums be commingled
Answer: Premiums are forwarded on a timely basis
Questions and Guide Answers
100% Verified Graded A+
1. Under a traditional IRA, interest is taxed
Only if withdrawn prior to age 59 1/2
According to the capital gains rate
Upon distribution
During the accumulation phase
Answer: Upon distribution
2. Which of these statements concerning Traditional IRAs is CORRECT?
Earnings are not taxable when withdrawn
Earnings are taxable when withdrawn
,Contribution are never tax deductible
Contributions are always made by the employer
Answer: Earnings are taxable when withdrawn
3. Which of these describes the result of a modified endowment contract that
failed to meet the seven- pay test?
Policy loans are disallowed
The premium payments will be tax deductible
Pre- death distributions are typically taxable
Withdrawals will be prohibited
Answer: Pre- death distributions are typically taxable
4. In order for a contract to be valid, it must
be filled with the state
be signing and witnessed by an attorney
,be in writing
contain offer and acceptance
Answer: Contain otter and acceptance
5. Which of the following actions is REQUIRED by a producer who is replacing
an existing life insurance policy?
Keep replacement records on file for at least 10 years
Notify the existing insurer of the proposed replacement
Submit to the replacing insurer a list of the policies to be replaced
Offer the insured a 60- day free- look period
Answer: Submit to the replacing insurer a list of the policies to be replaced
6. Who were Keogh plans designed to provide pension benefits for?
Corporate officers
Public school employees
The self-employed
Government employees
, Answer: The self emplyed
7. A producer's fiduciary duty requires that
premiums are maintained in a personal bank account until remittance to
insurer
premiums be deposited in an interest bearing account
premiums are forwarded to the insurer on a timely basis
premiums be commingled
Answer: Premiums are forwarded on a timely basis
