What is created after policy proceeds are obtained in a lump sum and then immediately invested? Loan against the cash value Policy withdrawal Policy dividend Death benefit, A business will typically use which type of life insurance to cover their employees? A) underwriting The insurer assuming the risk is called the mutual insurer reinsurer reciprocal insurer participating insurer, Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. An example of an unfair claims practice would be, Failing to effectuate prompt, fair, and fair equitable settlements of a claim. A paid premium $2,406 How does life insurance create an immediate estate? Advertisement. Life & Health 1 (Chapters 1, 2, 3, & 4) Flashcards Preview - Brainscape A) offer and acceptance Modified Endowment Contract Current assumptive whole life Credit life insurance Equity index whole life, What kind of life insurance policy covers two or more people with the death benefit payable upon the last person's death? A) Insurable interest At what point may a producer sell insurance for an insurer? A) State Insurance Departments Rob purchased a standard whole life policy with a $500,000 death benefit when we was age 30. C) A contract where one party "adheres" to the terms of the contract The annuitants life expectancy determines the annuity payments, No one may be denied coverage by an insurance company due to, A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n). D) errors and oversights, In an insurance contract, the insurer is the only party legally obligated to perform. Competent parties Offer and acceptance Consideration Legal purpose, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? legal reserve, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? _______ is the authority given to a producer to transact business on behalf of the insurer. An insurance contract usually involves an exchange of consideration between both parties: the insurer agrees to provide coverage and pay claims in the event of a loss, and the policyholder agrees to pay premiums in return. Aleatory Contract: A contract type in which the parties involved do not have to perform a particular action until a specific event occurs. 3. Multiple-choice. 2 See answers B) acceptance B) concealment Her son, Mike, is the beneficiary. B) Rescind the policy Which of the following best describes a symbol D) conditions, The authority granted to a licensed producer is provided via the Express Apparent Implied Conditional, The type of multiple protection coverage that pays on the death of the last person is called a(n) joint life policy survivorship life policy annuity joint policy dual life policy, A nonforfeiture option can be used to increase the death benefit, All of these are valid options for an Adjustable Life Policy EXCEPT The policy's premium can be increased or decreased The policy's death benefit can be increased or decreased A nonforfeiture option can be used to increase the death benefit The policy's protection period can be modified, A life insurance contract which accumulates cash values higher than the IRS will allow, A Modified Endowment Contract (MEC) is best described as A life insurance contract which accumulates cash values higher than the IRS will allow An annuity contract which was converted from a life insurance contract A modified life contract which enjoys all the tax advantages of whole life insurance A life insurance contract where all withdrawals prior to age 65 are subject to a 10% penalty, An interest-sensitive life insurance policyowner may be able to withdraw the policy's cash value interest free. C) Probability of loss B) A contract that has the potential for the unequal exchange of consideration for both parties What are conditions in an insurance policy? Identify the type of financing (stock or bond) that best answers the question. renewal reinstatement resumption renovation, the MEC tends to be an investment vehicle, Pre-death distributions from a modified endowment contract (MEC) receive different tax treatment than other life insurance policies because the MEC has tax deductible premiums the MEC is considered an illegal product the MEC tends to be an investment vehicle the MEC does not accumulate cash value, The face amount and premium will remain constant over the 10-year period, Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. The period of coverage The face amount The premium payments The cash value, at a predetermined date or age, regardless of the insured's health, A Renewable Term Life insurance policy can be renewed at a predetermined date or age, regardless of the insured's health only if the insured provides evidence of insurability anytime at the policyowner's request typically with no change in premium, Pre-death distributions will become taxable, Under a Modified Endowment Contract, what are the likely tax consequences? Conditional Contracts: Everything You Need to Know - UpCounsel Plot this function and determine if she is ready to attempt the Bluenose Marathon. D) only when determined by a judge, Xcel Chapter 3 Legal Concepts of the Insuranc, Chapter 3 Exam - Legal Concepts of the Insura, Chapter 4 Exam - Life Insurance - Types of Po, 4 - (Questions) Life Insurance Policies - Pro, Chapter 5: Life Insurance Premiums, Proceeds,, Chapter 4: Type of Insurance Policies Part 1, Chapter 4: Policy Provisions, Options and Rid, Calculus for Business, Economics, Life Sciences and Social Sciences, Karl E. Byleen, Michael R. Ziegler, Michae Ziegler, Raymond A. Barnett, Fundamentals of Engineering Economic Analysis, David Besanko, Mark Shanley, Scott Schaefer, The Cultural Landscape: An Introduction to Human Geography, AP Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Unit 7 AP Env. Provide an opinion. Producers act in a(n) ________ capacity when holding insurance premiums. Term Straight Life Endowment Variable Life, A life insurance policy that has premiums fully paid up within a stated time period is called stated payment insurance limited universal insurance stated modified insurance limited payment insurance, Reggie purchased a life insurance policy with a face amount of $500,000. B) Law of adhesion Policyowner has the right to select the investment which will provide the greatest return. It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance. the contract must be a contract of adhesion, there must be legal reasons for entering into the contract, What makes an insurance policy a unilateral contract? Utah requires that an insurance producer must complete ___ hour(s) of continuing education on the subject of law and ethics every reporting period. In which form of corporate financing is the investor also an owner? Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary? A unilateral contract is one in which only one party makes a legally binding guarantee. The face amount and premium will remain constant over the 10-year period. Returning a portion of a premium as inducement to purchase insurance, An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out. The terms and conditions of insurance contracts should be carefully reviewed by policyholders before signing. Which of the following BEST describes a conditional insurance contract? A contract that requires certain conditions or acts by the insured individual, According to life insurance contract law, insurable interest exists, The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as. underwriting A rating from a rating service company, such as A.M. Best An illustration A sales presentation Direct mailing from an agency, Fraternal Benefit Society has each of the following characteristics EXCEPT Incorporated Without capital stock Exist For profit Exist for the benefit of its members, A plan in which an employer pays insurance benefits from a fund derived from the employer's current revenues is called A self-derived plan A multiple-employer plan A blanket plan A self-funded plan, An insurer's ability to make unpredictable payouts to policyowners is called investment values liquidity assets capital, Ken is a producer who has obtained Consumer Information Reports under false pretenses. Express What are an applicants statements concerning occupation, hobbies, and personal health history regarded as? Net death benefit will be reduced if the loan is not repaid No interest will be charged on loan balance Term life policies are the only type of insurance that allows policy loans A loan can be taken out for up to the face amount of the policy, Ownership of a life insurance policy may be temporarily transferred with a(n) collateral assignment absolute assignment transferable assignment beneficiary assignment, provide evidence of insurability to the insurer, In order to activate the reinstatement clause of a lapsed life insurance policy, the insured MUST remit all past-due premiums within the grace period provide evidence of insurability to the insurer resubmit a new life insurance application provide a valid reason for the lapse, Which of the following is considered to be an alternative to a life settlement? It is a government agency that collects medical information on the insured from the insurance companies C. It is a member organization that protects against insolvent insurers D. All of the following are examples of a Business Continuation Plan EXCEPT. Insurer's promise to pay benefits A paid premium Legal purpose Intent, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties, What is implied authority defined as? Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium". C) Competent parties Expert answered|Malekith22|Points 0| Log in for more information. Which of the following statements correctly describes a contract of indemnity? The present cash value of the policy equals $250,000. Legal Consideration Competent parties Countersignature, A contract that requires certain conditions or acts by the insured individual, Which of the following BEST describes a conditional insurance contract? Julie has a $100,000 30-year mortgage on her new home. Which of the following Best Describes a Conditional Insurance Contract Posted on April 19, 2022 by Ephori London To be enforceable, a contract must be concluded by the competent parties. All of these are typically sources of underwriting information for life or health insurance EXCEPT. Ken is a producer who has obtained Consumer Informations Reports under false pretenses. purpose, Insurable interest does NOT occur in which of the following relationships? It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. C) fiduciary trust What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured? Barbaras policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. After a number of years, the policy's cash value accumulates to $50,000 and the face amount becomes $350,000. Which military service exclusion clause would pay upon his death? What kind of policy is this? Risk reduction Risk transference Risk avoidance Risk retention, The cause of a loss is referred to as a(n) hazard adversity peril risk, How do insurers predict the increase of individual risks? A Dalhousie University student training for distance running finds that, after running for x hours, her distance traveled, in kilometers, is given by, y=f(x)={10xif0x35x+15if3 Declaratory Judgment Texas Family Law,
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