PRIMERICA EXAM TEST 4 EXAM REVIEW
QUESTIONS AND CORRECT ANSWERS
◉ Absolute Assignment.
Answer: A permanent and irrevocable transfer of rights and/or
benefits by the policyowner.
◉ Collateral Assignment.
Answer: A temporary and/or revocable transfer of benefits by the
policyowner.
◉ Accelerated Death Benefit.
Answer: Policy provision that allows full or partial payment of the
policy's death benefit before the insured's death if he/she is
terminally ill.
◉ Accidental Death Benefit.
Answer: An extra cost rider that requires the insurance company to
pay an additional benefit in the event that the insured dies within 90
days of an accident as a direct result of the accident.
◉ Accumulate at Interest.
,Answer: The Dividend Option where the policyowner leaves the
dividends with the insurer to invest and earn interest.
◉ Adhesion.
Answer: Since the insurer created all the documents of the contract,
any ambiguities in the contract will be settled in favor of the insured.
◉ Adverse Selection.
Answer: The tendency for less favorable risks to seek or continue
insurance to a greater extent than more favorable risks.
◉ Agency Agreement.
Answer: A legal document containing the terms of the agreement
between the agent and the insurance company.
◉ Agent Authorities.
Answer: Expressed: Power or authority specifically granted in
writing to an agent by the insurance company in their Agency
Agreement.
◉ Agent/Producer.
Answer: Anyone who sells or aids in the selling of insurance. Legally
represents the company.
,◉ Agent's Report.
Answer: A written report from the agent submitted to the insurer
along with the application disclosing what the agent knows,
observed, or learned about the proposed insured's risks.
◉ Aleatory.
Answer: Unequal exchange of value. One party may obtain a far
greater value than the other under the contract.
◉ Annual Renewable Term.
Answer: A Term Life Insurance contract which gives the policyowner
the option to renew the policy each year without showing proof of
insurability.
◉ Annuitant.
Answer: The person that buys an annuity; may or may not be an
annuity's policyowner.
◉ Annuity.
Answer: A contract/policy that guarantees to pay income for a
specified period of time or for the life of the annuitant.
◉ Appointment.
, Answer: Authorization of an agent/producer by an insurer to
represent the company.
◉ Blackout Period.
Answer: The period of time between the youngest child turning 16
and the widow(er) reaching retirement age during which no Social
Security Survivor Benefits are paid to the surviving spouse.
◉ Buy-Sell Agreement.
Answer: Business use of Life Insurance where partners in a business
buy life insurance on each other.
◉ Cash Nonforfeiture Option.
Answer: Policyowner receives a lump-sum payment of the current
cash value of the policy upon surrender of the policy.
◉ Cash Settlement Option.
Answer: Upon maturity of an insurance policy the beneficiary
receives a lump-sum payment of the entire policy proceeds due.
◉ Cash Value.
Answer: That part of an insurance policy that is the equity amount
legally available to the policyowner.
QUESTIONS AND CORRECT ANSWERS
◉ Absolute Assignment.
Answer: A permanent and irrevocable transfer of rights and/or
benefits by the policyowner.
◉ Collateral Assignment.
Answer: A temporary and/or revocable transfer of benefits by the
policyowner.
◉ Accelerated Death Benefit.
Answer: Policy provision that allows full or partial payment of the
policy's death benefit before the insured's death if he/she is
terminally ill.
◉ Accidental Death Benefit.
Answer: An extra cost rider that requires the insurance company to
pay an additional benefit in the event that the insured dies within 90
days of an accident as a direct result of the accident.
◉ Accumulate at Interest.
,Answer: The Dividend Option where the policyowner leaves the
dividends with the insurer to invest and earn interest.
◉ Adhesion.
Answer: Since the insurer created all the documents of the contract,
any ambiguities in the contract will be settled in favor of the insured.
◉ Adverse Selection.
Answer: The tendency for less favorable risks to seek or continue
insurance to a greater extent than more favorable risks.
◉ Agency Agreement.
Answer: A legal document containing the terms of the agreement
between the agent and the insurance company.
◉ Agent Authorities.
Answer: Expressed: Power or authority specifically granted in
writing to an agent by the insurance company in their Agency
Agreement.
◉ Agent/Producer.
Answer: Anyone who sells or aids in the selling of insurance. Legally
represents the company.
,◉ Agent's Report.
Answer: A written report from the agent submitted to the insurer
along with the application disclosing what the agent knows,
observed, or learned about the proposed insured's risks.
◉ Aleatory.
Answer: Unequal exchange of value. One party may obtain a far
greater value than the other under the contract.
◉ Annual Renewable Term.
Answer: A Term Life Insurance contract which gives the policyowner
the option to renew the policy each year without showing proof of
insurability.
◉ Annuitant.
Answer: The person that buys an annuity; may or may not be an
annuity's policyowner.
◉ Annuity.
Answer: A contract/policy that guarantees to pay income for a
specified period of time or for the life of the annuitant.
◉ Appointment.
, Answer: Authorization of an agent/producer by an insurer to
represent the company.
◉ Blackout Period.
Answer: The period of time between the youngest child turning 16
and the widow(er) reaching retirement age during which no Social
Security Survivor Benefits are paid to the surviving spouse.
◉ Buy-Sell Agreement.
Answer: Business use of Life Insurance where partners in a business
buy life insurance on each other.
◉ Cash Nonforfeiture Option.
Answer: Policyowner receives a lump-sum payment of the current
cash value of the policy upon surrender of the policy.
◉ Cash Settlement Option.
Answer: Upon maturity of an insurance policy the beneficiary
receives a lump-sum payment of the entire policy proceeds due.
◉ Cash Value.
Answer: That part of an insurance policy that is the equity amount
legally available to the policyowner.
