C) Because an insurance company's strength and stability are two very crucial factors in its sustainability, independent rating services have formed to publish regular updates on the financial integrity of different insurance companies. Carl would like to purchase life insurance. Your device, make and model. Legislative advocacy is essential to Physicians Insurance/MedChoice's purpose to protect, defend, and support our Members. Inventory balances at the beginning and end of October were: Only 75% of the utilities expense and 60% of the insurance expense apply to factory operations. (economy). -Take it or leave it contract Participating policy. 1) cash value earns interest ADD( Accidental death and dismemberment??? c) Accelerated benefit rider. 2)Legal Purpose What does "liquidity" refer to in a life insurance policy? Adverse selection is well controlled. Which of the following statements about a life insurance policy is (are) true? &\text { Rental Class }\\ The County is administered by a five-member Board of Supervisors who are elected for four-year terms 2)quarterly Which of the following documents must be provided to the policyowner or applicant during policy replacement? b) Human life value approach A. (c) PV of the family's share of a deceased breadwinner's future earnings. 2)premium gets lower. a. mentally counting backward from 1,0001,0001,000 Weiss and Fitch are two of these services, although there are more. D) An agent's report and inspection report provides personal information. \text { Type II } & \$ 20 & \$ 30 & \$ 40 B. a) The policy can be converted to term coverage. ~~~\text{Indirect labor cost}&28,000\\ When will coverage begin? These individuals qualify for lower premiums than those in the other categories. Premiums are taxable to the employee In this case, the applicant will most likely need to fill out a Statement of Good Health. All of the following are common characteristics of this coverage EXCEPT (must exist at the time of application). (a) limited-payment whole life insurance 1. \text { Type I } & \$ 30 & \$ 35 & - \\ If the insured commits suicide after the 2 year period, the policy will pay the death proceeds to the designated beneficiary the same as if the insured had died of natural causes. This is true whether a property or liability form; and regardless whether the insured is a commercial or personal lines client. 4)Based on principle sum(rider) & capital sum(insurer) 50%, 3rd party ownership insurers issues policy to a lending institution C. Certain Risk 1) the premium amount c) The inspection report Any gain in the policy's cash value is . What is an exchange of a whole entire life policy for another? The 7 paytest is used to determine if a policy is a _______? A. contract of adhesion Close Skip to Content High Contrast Increase Text Size Clear All 515-705-0233. -it is a type of Rider Life expectancy has increased in the U.S. over the last century. D. They can decide when to pay their monthly premiums. (c) Interest credited to a policy's cash value is taxable to the policyowner in the year credited. He would also like to invest in a mutual fund. SalesrevenueLess:OperatingexpensesRawmaterialspurchasesDirectlaborcostAdvertisingexpenseSellingandadministrativesalariesRentonfactoryfacilitiesDepreciationonsalesequipmentDepreciationonfactoryequipmentIndirectlaborcostUtilitiesexpenseInsuranceexpenseNetloss$264,000190,00090,00075,00060,00045,00031,00028,00012,0008,000$780,000803,000$(23,000). B) After a claim has been adjusted and is found to be covered under the policy, the insurer must pay the claim upon receipt of a signed proof of loss. d) All of the above. O b. Receipt Company A carries 1/3 of the total coverage ($20,000 + $40,000 = $60,000). b) Fiduciary responsibility. Department of Defense Only one party is giving a legally enforceable promise- A one-sided contract is what? (a) The insurance provides protection for a temporary period of time. D. Department of Treasury Insurance that is provided by the Federal or State Government and sex doesn't determine eligibility? Originating policy a) The amount of insurance on the life of any debtor may exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor. -insured can stop paying premiums at certain age or after a period of time What is the MIB? The correct answer is: Maggie's Piano Studio with 1 employee. On DUE DATE. InventoryJul1Jul3122,000???? b) An agent offers to share his commission with a policyholder. \hline & \text { Jul 31 } & 19,500 c) Whole Life (a) renewal provision -If the insured dies, the policy payed out the PRINCIPAL SUM 1)cont. Upon policy delivery, the producer may be required to obtain any of the following EXCEPT Life insurance prodceeds &\text { Accumulated depr.-equipment }\\ D. Claim History &\begin{array}{lr|rr} - If the insured suffers a dismemberment the policy pays the CAPITAL SUM which is 50% of the principal sum. ? B. Marital Status D. Represent the insured's interest Predicted needs of the family after the insured's death C) Annually renewable term policies provide a level death benefit for a premium that increases each year with the age of the insured. (receive dividends & the right to vote). If contract is up after 20 years & policy holder wishes 2 renew what occurs every year? When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable statement of good health D. Viatical settlement. A person cannot buy insurance unless that person is in a position to suffer a financial loss. c) Low-income individuals and families 2)Variable annuity A false statement in the application for insurance is_____________. C. Domestic 3)certified public accountants, Is insurance that is provided by the Federal or State government II. 3) type of plan they applied for. Contract of adhesion In an insurance contract, the value that each party gives the other is called the: When an individual faces the risk of economic loss in the event of property damage, this indicates which of the following? Which of the following would be the best option that would help the surviving spouse of the insured to put her child through daycare after the insured's death? D. The policy is a bilateral contract b) Adjustable life A whole life insurance policy is exchanged for a term insurance policy, Which of the following will be included in a policy summary? \underline{\hspace{40pt}}. The ___________ controls all rights of the contract. Investors become more risk averse. b) Increasing Premium Question: All of the following statements about variable life insurance are true EXCEPT O a. -the applicant must always initial the change To sell variable life insurance policies, an agent must receive all of the following EXCEPT Chapter 11 - Life Insurance. Correct: A Insurance . The Terrorism Risk Insurance Program is administered by which of the following Federal entities? (d) indeterminate-premium whole life. ~~~\text{Insurance expense}&\underline{8,000}&\underline{803,000}\\ d. The total of all cost sheets completed during the month is $628,880.00. Term-Life policy has what 3 characteristics? The safety margin is narrower, because the cost of the insurance to the policyholder cannot be adjusted at a later time. What type of policy does the insured most likely have? Tax-qualified annuities are subject to IRA maximum contribution limits. There is no limitation on the number of key employee plans in force at any one time B. Address of his principal office B. Something of value is a __________________. All renewable term policies are accepted without__________ and only with_____ collected. \end{array} 1) Conditional Reciept D. Premiums paid are deductible as a business expense. All of the following statements about term insurance are true EXCEPT. The correct answer is: Premiums are typically paid by the lender. Limited-Pay Life & Single-Premium Policies? c. Manufacturing expense accounts and their balances for the month are as follows: DepreciationExpense-FactoryEquipment$5,770.24MiscellaneousExpense-Factory$13,780.48DepreciationExpense-Building2,822.40PayrollTaxesExpense-Factory43,736.00Heat,Light,andPowerExpense9,055.20PropertyTaxExpense-Factory6,088.32InsuranceExpense-Factory1,505.28SuppliesExpense-Factory18,063.36\begin{array}{lrlrr}\text { Depreciation Expense-Factory Equipment } & \$ 5,770.24 & \text { Miscellaneous Expense-Factory } & \$ 13,780.48 \\ \text { Depreciation Expense-Building } & 2,822.40 & \text { Payroll Taxes Expense-Factory } & 43,736.00 \\ \text { Heat, Light, and Power Expense } & 9,055.20 & \text { Property Tax Expense-Factory } & 6,088.32 \\ \text { Insurance Expense-Factory } & 1,505.28 & \text { Supplies Expense-Factory } & 18,063.36\end{array} A life insurance license. They keep a high percentage of any interest earned on their policies D. Reduction is a method of managing risk. B. e. The total of costs recorded on all sales invoices for the month is$654,052.00. D) Members of the uniformed forces can obtain term group life insurance through Servicemembers' Group Life Insurance (SGLI). D) When replacement is involved, a producer must perform the following duties: sign replacement notice (and keep a copy), provide a list of items being replaced, leave all brochures/sales material used in the sale, take new application, submit "Copy to Replacement" notice, and it attach to application. 3) Retaining the risk. -guarantee a stream of income to the person purchasing it known as the annuitant. D. Offer It has cash value that is invested into the stock market through mutual funds/securities. C. Whole life A FINRA registration. B) According to the law of large numbers, the larger a group becomes, the easier it is to predict losses. (Hint: Take a look at the Theory of Reasoned Action.). -low commissions b) Copies of illustrations and application B. c) Guides describing company financial integrity B) Underwriters. a) Types of mutual companies & \text{ ???? } In a conditional receipt if the policy holder dies before delivery of the policy what has to happen for the benefits to be paid? b) Failure to promptly settle a claim when liability has been clearly established A key person insurance policy will pay for costs of running the business and replacing the employee. All of the other statements are true. 17,000, InventoryJul122,000???? B. Buy-Sell Agreements pay in the event of a medical emergency (d) yearly renewable term, Which statement is true concerning premature death and life expectancy? All of the following are options for managing risk, except: means of collecting a loss payment from a liable party. B) Fiduciary refers to a position of trust. All of the following statements about ordinary life insurance are true EXCEPT. a sheet where the agent lists any additional info about insured including: habits,financial status, or anything that may be important for the underwriting department to determine the risk involved. B. (d) Most policies have a CV that is refunded when coverage ceases. Appoint a solicitor as his or her representative 3. Which method makes the most sense for her to employ? Reinsurance has 2 types of policys, what are they? Correct: D. Department of Treasury, The Terrorism Act, which protects consumers by addressing market disruptions and ensuring the continued widespread availability and affordability of property and casualty insurance for a terrorism risk, is a administered by the Department of Treasury. (Choose from the following options) In order for the contract or policy to be valid or legal? (b) single-parent family. (d) paid-up. (d) sandwiched family. 2. 3)semi-annual B. Insureds current and future income b. it frequently includes coverage for losses due to casualty and theft. B. IRS has no jurisdiction A ______ will receive unfavorable tax treatment. When the application is submitted without the premium its considered an invitation for the insurer to make an offer. Conditional Contract c) Fixed premium Pertaining to insurance, what is the definition of a fiduciary responsibility? \end{array} B. C. Medical Background How much life insurance should Sam advise . C. A husband or wife has an insurable interest in their spouse C. Countersign insurance contracts &\begin{array}{cr|} C. State Education Waiver b) Hazard A. a) Material change d) The policy can be reinstated by paying back all policy loans and premiums. a) Lump-sum approach Cash Accumulation C. Buy-Sell agreement D. Survivor Protection, All of the following are true of key person insurance except A. 2)Foreign Insurer b) Policyholder ~~~\text{Raw materials purchases}&\$264,000\\ 21,000 \\ D) The Fair Credit Reporting Act governs what information can be collected and how the information can be used. Nonparticipating policy. Annually renewable term policies provide a level death benefit for a premium that Insurance is an important tool to manage risks, but often unavailable to poorer households. \end{array} B) A "cost of living" rider adjusts the face amount of a policy to maintain the relationship of the face amount and increases in the cost of living. C. It's a decreasing term insurance. a) Payor rider. WorkinProcess$229,040.00EmployeeIncomeTaxPayable$33,880.00FactoryOverhead78,960.00SocialSecurityTaxPayable19,096.00Cash250,558.00MedicareTaxPayable4,466.00\begin{array}{lrlr}\text { Work in Process } & \$ 229,040.00 & \text { Employee Income Tax Payable } & \$ 33,880.00 \\ \text { Factory Overhead } & 78,960.00 & \text { Social Security Tax Payable } & 19,096.00 \\ \text { Cash } & 250,558.00 & \text { Medicare Tax Payable } & 4,466.00\end{array} (Choose from the following options) 1. B. Endowments means policy is what(2) things? c) Premium accountability. C. Funding business continuation agreements ____________ is the transfer of the right of recovery from the insured to the insurance company. The Boyle family can be described as a When a replacement is involved, a replacing insurance company is responsible for all of the following EXCEPT: Provide a copy of the Important Notice Regarding Replacement of Life Insurance to the applicant. b) Fixed income when the applicant/owner is not the insured-3rd party (a) I only (b) II only B. a) Universal life What are the temporary needs? ____________ insurer is not a type of insurer. C. Hazards Exclusion Categories (b) variable life insurance An agent that enters into agreements with more than one insurer is called an: A _______ represents the insured in dealing with insurance companies. -7 pay test is used to determine If a policy is a MEC. A) loss reserves 2. D. Alien Dividends received by policyholders of a mutual insurer are not taxable. 3)increase the length of coverage Since they may receive a dividend (not guaranteed), such policies are known as participating policies. Which of the following statements is not correct regarding rates and premiums? \hline \text { Jul 1 } & 22,000 \\ & \text { Depr } & 3,000 \\ Costs of training a replacement 1)Level d) The Medical Information Bureau. d) An insurer may exclude any debtors as to whom evidence of individual insurability is not satisfactory to the insurer. ~~~\text{Rent on factory facilities}&60,000\\ All of the following statements are TRUE concerning Debtor Groups EXCEPT 2)Decreasing Term Certificate holders may convert coverage to an individual policy without evidence of insurability. IN WHITE RAIMENT. 4)settlement options, 1)stand alone policy Prior to October 2017, the company had been profitable every month. -The insurance dept. Term. 4. If there Is a risk of financial loss then there is a what? Correct: A. a surplus lines broker places risks with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers. 2)Explain and collect any ratings To be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. 4. A. A conditional or binding receipt is given when an applicant does what? A policy that does not pay dividends to policyowners is a All of the following statements are true regarding mortgage protection insurance EXCEPT. Which of the following about the use of ordinary life insurance is true? All of the following statements concerning coinsurance are true, EXCEPT . It is most appropriate when an insured needs lifetime protection. A Contract that binds only one party to future performance, is a (n): A. C. Medical Background Any profit realized in the operation will be used to provide dividends to stockholders as well as surplus funds that may be used as a buffer for future adverse experience. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. An applicant is denied insurance because of information found on a consumer report. Costs of training a replacement -ages 25,28,34,37,40 This form of life insurance has fixed premiums and the cash value is not guaranteed. 1) All requirements are met 3. All of the following statements about term insurance are true EXCEPT. Tamara purchased a term insurance policy when she had high life insurance needs and limited income. A) The amount of insurance of the life of any debtor may at no time exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor. A. Social Security is designed to provide a base of economic security B. A mutual insurance company is owned by who? Therefore, it is responsible for 1/3 of the $24,000 loss, or $8,000. -kids till 21 c) Helping insureds to file claims -Both parties must follow certain conditions set forth in contract, -IRS classification of a policy that is overfunded \end{array} An agent tells an insured that if he replaces his current insurance policy with a newer one, his dividends will be higher and his premium will be slightly lower. B. Misrepresentation _________ is a determination that a statement made as a warranty, or true. James purchased yearly renewable term insurance. -immediately considered fully paid up Is interest always gained in Universal Life Policy? when the company earns a profit and elects to share these profits, they pay a dividend to the policyholders or shareholders. Life insurance is unique from other types of insurance in that it could perform the function of cash accumulation. Why do most states have a waiting period for couples applying for marriage licenses? D) When immediate annuities are used to pay IRA benefits, distributions must begin no later than age 70 in order for the annuitant to avoid penalties. D. Concealment Who would be eligible to obtain SGLI? What insurance concept is associated with the names Weiss and Fitch? Insurance is designed to cover both intentional and unintentional losses. 3)2 death benefit option Signed waiver of premium C) the proposed insured. (b) Prepare a correct income statement for October 2017. After insurer makes an offer, what must the applicant do? What type of interest does universal life have? How do premiums for yearly renewable term insurance change as an insured gets older? What else must he include? Both life and health insurance can be used for a variety of purposes in a business setting, including the funding of business continuation agreements, compensating executives, and protecting the firm against financial loss resulting from the death or disability of key employees. Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE?
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