ARKANSAS LIFE INSURANCE
EXAM|ORIGINAL 240Qs&As|ALREADY
GRADED A+|100% VERIFIED
J is a producer who has induced an insured through misrepresentation to surrender an
existing insurance policy. What is J guilty of? -CORRECTANSWER Twisting
What is implied authority defined as? -CORRECTANSWER Authority that is not
specifically given to an agent contract, but that an agent can reasonably assume to
carry out his/her duties
A person who is a nonsmoker, average weight, excellent health would fall into what risk
classification? -CORRECTANSWER Preferred
Which of the following is considered to be the period when the accumulated value in an
annuity is paid out? -CORRECTANSWER Annuitization phase
An insurers claim settlement practices are regulated by the: -CORRECTANSWER State
insurance departments
An insurers ability to make unpredictable payouts to policy owners is called: -
CORRECTANSWER Liquidity
,Which of the following pertains to the analysis of an applicants personal information and
determining whether insurance should be issued or declined? -CORRECTANSWER
Underwriting
What does the Group Life underwriting risk selection process help protect insurance
companies from? -CORRECTANSWER Adverse Selection
The Arkansas Life & Disability Insurance Guaranty Association assures payment of
benefits from insurance policies for insolvent insurers, and covers all of the following
insured policies, EXCEPT: -CORRECTANSWER Liability Insurance
What would happen if a life insurance applicant is given a conditional receipt from an
insurance agent and then dies the next day? -CORRECTANSWER Claim will be paid if
application is approved
A life insurance policy owner does NOT have the right to: -CORRECTANSWER Revoke
an absolute assignment
An employee under a group insurance policy has the right to name a beneficiary and
the right to: -CORRECTANSWER Convert to an individual policy in the event of
employment termination
,The two major actions required for a policyholder to comply with the Reinstatement
Clause are -CORRECTANSWER Provide evidence of insurability, past due premiums
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following
statements is true? -CORRECTANSWER The policy may be paid up early by using
policy dividends
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If
the consumer price index has gone up 4%, how much may Ron increase the face value
of the policy? -CORRECTANSWER $4,000
($100,000 X .04 = $4,000)
Krissa purchases a 10-year level term life insurance policy that has a death benefit of
$200,000. Which of these statements is true? -CORRECTANSWER The face amount
and premium will remain constant over the 10-year period
What is Arkansas' REQUIRED grace period for a life insurance contract? -
CORRECTANSWER 31 days
A domestic insurance company in Arkansas MUST -CORRECTANSWER Be organized
under Arkansas Insurance laws
, Simon has purchased a fixed immediate annuity. His payment amount will be
dependent upon principal, interest, and the contract's -CORRECTANSWER Income
period
What kind of life insurance policy issued by a mutual insurer provides a return of
divisible surplus? -CORRECTANSWER Participating life insurance policy
No one is allowed to act as a producer for any insurance company in Arkansas that -
CORRECTANSWER Is unauthorized to do business in Arkansas
What MUST the company do prior to conducting an HIV related test? -
CORRECTANSWER Obtain a written consent from the proposed insured
Which approach predicts a person's earning potential and determines how much of that
amount would be devoted to dependents? -CORRECTANSWER Human life value
approach
If the annuitant dies before the annuity start date, -CORRECTANSWER The premiums
paid plus interest earned will be given to the beneficiary
If dividends are illustrated, the advertisement MUST state that the dividends are: -
CORRECTANSWER Not guaranteed
EXAM|ORIGINAL 240Qs&As|ALREADY
GRADED A+|100% VERIFIED
J is a producer who has induced an insured through misrepresentation to surrender an
existing insurance policy. What is J guilty of? -CORRECTANSWER Twisting
What is implied authority defined as? -CORRECTANSWER Authority that is not
specifically given to an agent contract, but that an agent can reasonably assume to
carry out his/her duties
A person who is a nonsmoker, average weight, excellent health would fall into what risk
classification? -CORRECTANSWER Preferred
Which of the following is considered to be the period when the accumulated value in an
annuity is paid out? -CORRECTANSWER Annuitization phase
An insurers claim settlement practices are regulated by the: -CORRECTANSWER State
insurance departments
An insurers ability to make unpredictable payouts to policy owners is called: -
CORRECTANSWER Liquidity
,Which of the following pertains to the analysis of an applicants personal information and
determining whether insurance should be issued or declined? -CORRECTANSWER
Underwriting
What does the Group Life underwriting risk selection process help protect insurance
companies from? -CORRECTANSWER Adverse Selection
The Arkansas Life & Disability Insurance Guaranty Association assures payment of
benefits from insurance policies for insolvent insurers, and covers all of the following
insured policies, EXCEPT: -CORRECTANSWER Liability Insurance
What would happen if a life insurance applicant is given a conditional receipt from an
insurance agent and then dies the next day? -CORRECTANSWER Claim will be paid if
application is approved
A life insurance policy owner does NOT have the right to: -CORRECTANSWER Revoke
an absolute assignment
An employee under a group insurance policy has the right to name a beneficiary and
the right to: -CORRECTANSWER Convert to an individual policy in the event of
employment termination
,The two major actions required for a policyholder to comply with the Reinstatement
Clause are -CORRECTANSWER Provide evidence of insurability, past due premiums
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following
statements is true? -CORRECTANSWER The policy may be paid up early by using
policy dividends
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If
the consumer price index has gone up 4%, how much may Ron increase the face value
of the policy? -CORRECTANSWER $4,000
($100,000 X .04 = $4,000)
Krissa purchases a 10-year level term life insurance policy that has a death benefit of
$200,000. Which of these statements is true? -CORRECTANSWER The face amount
and premium will remain constant over the 10-year period
What is Arkansas' REQUIRED grace period for a life insurance contract? -
CORRECTANSWER 31 days
A domestic insurance company in Arkansas MUST -CORRECTANSWER Be organized
under Arkansas Insurance laws
, Simon has purchased a fixed immediate annuity. His payment amount will be
dependent upon principal, interest, and the contract's -CORRECTANSWER Income
period
What kind of life insurance policy issued by a mutual insurer provides a return of
divisible surplus? -CORRECTANSWER Participating life insurance policy
No one is allowed to act as a producer for any insurance company in Arkansas that -
CORRECTANSWER Is unauthorized to do business in Arkansas
What MUST the company do prior to conducting an HIV related test? -
CORRECTANSWER Obtain a written consent from the proposed insured
Which approach predicts a person's earning potential and determines how much of that
amount would be devoted to dependents? -CORRECTANSWER Human life value
approach
If the annuitant dies before the annuity start date, -CORRECTANSWER The premiums
paid plus interest earned will be given to the beneficiary
If dividends are illustrated, the advertisement MUST state that the dividends are: -
CORRECTANSWER Not guaranteed
