If thats the case, you dont have to worry anymore. In exchange, the policyowner pays premiums. C) apparent authority D) Only the insured is legally bound, Bob and Tom start a business. A Modified Endowment Contract (MEC) is best described as, A life insurance contract which accumulated cash values higher than the IRS will allow, Doctors pooling their money to cover malpractice exposures, The free-look provision gives the policyowner, The right to return the policy for a full refund within a specified number of days. Updated 10/6/2017 9:10:03 AM. Anheuser-Busch InBev is trying to reduce its water usage. Waiver of premium Juvenile waiver Guaranteed insurability Payor benefit, Which of the following is a reinstatement condition? The policies continue in force with no change. When does a life insurance policy typically become effective? B) Offer and acceptance Which of the following does a life insurance policy summary normally include? What is this called? The above question Which of the following BEST describes a conditional insurance contract?, Was part of Insurance MCQs & Answers. Which of the following statements about aleatory contracts is NOT true? term, whole, and universal life insurance increasing term insurance joint, credit, and group life insurance adjustable, permanent, and limited-pay life insurance, Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index. What is created after policy proceeds are obtained in a lump sum and then immediately invested? Before using an assumed name in Utah, a producer MUST, Maria would like an annuity that provides a guaranteed accumulation or payout. Authority given in writing to an agent in the agency agreement Under a life insurance policy, what does the insuring clause state? express authority Which of these statements is true? Which of the following BEST describes a conditional insurance contract? D) unilateral, Who is responsible for assembling the policy forms for insureds? A) underwriting Which type of life insurance policy is this? Which market index is normally associated with an indexed annuitys rate of return? It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill. James is the insured on a life insurance policy where his age was misstated on the application. Bob dies 12 months later. ______ is NOT an element of a valid contract. Connect the text to your own experiences. A) Insurable interest Modified Whole Life Decreasing Term Life Adjustable Life Whole Life, Decreasing term life insurance is often used to provide retirement funds provide coverage for a home mortgage accumulate cash value provide coverage for estate taxes, Which of these is NOT subject to income taxation under a Modified Endowment Contract (MEC)? c. income earned by Pat's spouse. Coverage decreases automatically Coverage increases automatically Coverage remains as long as proof of insurability is provided Coverage is eliminated, Joe has a life insurance policy that has a face amount of $300,000. It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. The face amount and premium will remain constant over the 10-year period. D) an offer and acceptance of the contract terms, D) an offer and acceptance of the contract terms, In an insurance contract, the applicant's "consideration" is the 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? A) Unilateral contract Bob dies 12 months later. Which dividend option would an insurer invest the policyowners money and add any interest earnings as the dividends accrue? Death benefits Cash value Loading costs Separate account investments, Which policy feature makes a universal life policy different from a whole life policy? Insurance contracts are unilateral contracts. Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. if the insured lives beyond the 5 years, no benefits are payable. Only the insured pays the premium Only the insured can change the provisions Only the insurer is legally bound Only the insured is legally bound, A professional liability for which producers can be sued for mistakes of putting a policy into effect is called fiduciary bond errors and omissions fiduciary trust errors and oversights, In order for a contract to be valid, it must be filed with the state be signed and witnessed by an attorney be in writing contain an offer and acceptance, 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". The terms of the policy typically outline these conditions . nonparticipating life insurance policy participating life insurance policy divisible surplus life insurance policy straight life insurance policy, Which of the following is considered to be an event or condition that increases the probability of an insured's loss? which of the following best describes a conditional insurance contract? What is the advantage of adding this rider? Which of the following BEST describes a conditional insurance contract. When the term insurance expires. Consideration A life insurance claim which involves a per capita distribution of policy proceeds would be payable to the. What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30-year period? Which of the following statements is true? If the other agreement or condition is performed, then the conditional contract is . Completing all applications and collecting initial premiums. B) Apparent 2003-2023 Chegg Inc. All rights reserved. B) at the time of application The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? consideration Adjustable life Credit life Modified life Universal life, Whole life policy with premiums paid up after 20 years, Which of these would be the best example of a limited pay life insurance policy? Which contract element is insurable interest a component of? D) A contract where only one party makes any kind of enforceable contract, Answer:A) A contract that requires certain conditions or acts by the insured individual. Reduction of premium dividend option Extended term option Paid-up option Cash dividend option, Net death benefit will be reduced if the loan is not repaid, Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. All of these are typically sources of underwriting information for life or health insurance EXCEPT. Advertisement. One-sided or unfair insurance contracts can, however, exist if they contain provisions that disproportionately benefit one party. D) only one party makes any kind of enforceable promise, C) the terms must be accepted or rejected in full, What is implied authority defined as? Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. which of the following best describes a conditional insurance contract? Legal purpose Which Of The Following Best Describes A Conditional Insurance Contract A) A contract that requires certain conditions or acts by the insured individual B) A contract that has the potential for the unequal exchange of consideration for both parties C) A contract where one party "adheres" to the terms of the contract B) premium only Term, whole, and universal life insurance. A) Insurer's promise to pay benefits D) Evident authority, Which of the following is an example of the insured's consideration? State Insurance Departments NAIC Insurance carriers Insurance producers, Intentional withholding of material facts that would affect an insurance policy's validity is called a(n) estoppel concealment adhesion misrepresentation, The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? Which of the following is true of the law of contracts? C) representation Describe the structure. Have a great time ahead. D) the authority to add provisions to a contract, C) the authority to represent the insurer, Which of the following contracts is defined as "one that restores an injured party to the condition that was present before the loss"? they are "take it or leave it" contracts. warranty guarantee representation collateral, there must be legal reasons for entering into the contract, Legal purpose is a term used in contract law meaning there must be an offer and acceptance the contract must be aleatory there must be legal reasons for entering into the contract the contract must be a contract of adhesion, In an insurance contract, the element that shows each party is giving something of value is called offer acceptance consideration purpose, What makes an insurance policy a unilateral contract? Of the following dividend options, which of these is taxable? A) A contract that requires certain conditions or acts by the insured individual. Which of the following BEST describes a conditional insurance contract? both parties consent to the contract. the contract must be aleatory Both partners are still married at the time of Bob's death. In most insurance policies, the insurer is the only one who makes a legally binding promise to pay insured claims. Insurable interest Insurance exchanges Law of large numbers and risk pooling Population table data, People with higher loss exposure have the tendency to purchase insurance more often than those at average risk. Period of time after the initial premium is paid and before the policy is issued Period of time it takes for a policy's underwriting to complete Period of time after a policy is issued and before it is delivered to policyowner Period of time after the premium is due but the policy remains in force, Life insurance policies will normally pay for losses arising from commercial aviation war suicide hazardous jobs, A policyowner may exercise which of these dividend options that uses the dividend to pay all or part of the next premium due? Policyowner has the right to select the investment which will provide the greatest return. Sharing commissions with a producer licensed in the same line of business. How do marketers use insights regarding the self-concept? Under the McCarran-Ferguson Act, what is the minimum penalty for this? A unilateral contract is one in which only one party makes a legally binding guarantee. B) Equal consideration is required between the involved parties Joint life policy Survivorship life policy Dual life policy Multiple life policy, A life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called whole life group life credit life universal life, Can be converted to permanent coverage without evidence of insurability, Donald is the primary insured of a life insurance policy and adds a children's term rider. Conditional insurance contracts are insurance policies that require the insured person to satisfy certain conditions in order to become effective and/or to be paid out by the insurer. The two major actions required for a policyowner to comply with the Reinstatement Clause are, Provide evidence of insurability, pay past due premiums, The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as. C) promises made Policyowner may increase or decrease the premium payments Policyowner may increase or decrease the face amount Policyowner can contribute large sums of money Policyowner has the right to select the investment which will provide the greatest return, All of the following riders can increase the death benefit amount EXCEPT Cost of Living Waiver of Premium Accidental Death Rider Guaranteed Insurability, Which of these is NOT considered to be a common life insurance nonforfeiture option? Accelerated death benefit An example of an unfair claims practice would be Only the insurance company has legal obligations. C) statements made in the application and the premium 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. A) there must be an offer and acceptance If xxx actually turns out to be 131313, what do you think of the claim? B) issuance of the policy This legal agreement requires prior performance of another agreement or clause in order to be enforceable. An individual who has a hobby racing cars once a month. In a life or health insurance contract, "consideration" would be the, statements made in the application and the premium, A professional liability for which producers can be sued for mistakes of putting a policy into effect is called. Insurable interest can be based on the love and affection of individuals related by blood or law An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of The terms of the policy typically outline these conditions, which may include paying premiums on time and maintaining the insured property in good condition. $0 $5,000 $10,000 $15,000, Determine financial strength of an insurance company, What is the primary purpose of a rating service company such as A.M Best? Which of the following is CORRECT regarding the death benefit amount? Which of the following statements is true? definitions conditional What does the Group Life underwriting risk selection process help protect insurance companies from? The death benefit paid will be what the premium would have purchased at the correct age, Converting a group plan to permanent life insurance requires, The conversion being applied for within 31 days of termination. Typically, bilateral contracts involve an equal obligation or. A contract that requires certain conditions or acts by the insured individual A contract that has the potential for the unequal exchange of consideration for both parties A contract where one party "adheres" to the terms of the contract Which of these would NOT be an unfair claims practice? D) Authority given to an agent to act outside the scope of the agency agreement, B) 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, Legal purpose is a term used in contract law meaning Insurance interest does NOT occur in which of the following relationships? C) Competent parties Adjustable life insurance Decreasing term insurance Increasing term insurance Modified life insurance, A spouse and child can be added to the primary insured's coverage as what kind of rider? Zucchini is the best descriptive word. C) Implied be filed with the state Which of the following does a producer NOT have a fiduciary responsibility to? A) Express authority Her son, Mike, is the beneficiary. C) there must be legal reasons for entering into the contract The terms and conditions of insurance contracts should be carefully reviewed by policyholders before signing. Which of the following describes a person who is NOT acceptable by an insurer at standard rates because of health history, occupation, or hobbies? A bilateral contract is an agreement between two parties in which each side agrees to fulfill their side of the bargain. Because of this, an insurance contract is considered B) Rescind the policy What Benefit Does The Payor Clause On A Juvenile Life Policy Provide? What guarantees that the statements supplied by an insurance applicant are true? (B) Both parties adhere to the contract. Insurance producer Jerry offers a $350 shopping card if they purchase an insurance product through him. 1 pt. B) guarantee _______ is the authority given to a producer to transact business on behalf of the insurer. Principal Capacity, All of the following are elements of an insurance policy EXCEPT With a life insurance contract, the insurer binds itself to pay a certain sum upon the death of the insured. Which Of The Following Best Describes A Conditional Insurance Contract. Preferred risk policies with reduced premiums are issued by insurance companies because the insured has, Better than average mortality or morbidity experience. In order for a contract to be valid, it must. Contestability clause, In order for a contract to be valid, it must Insurer's promise to pay benefits A) the appearance of authority an insurer gives to its agent acceptance Bob and Tom start a business. Parent and children contain an offer and acceptance, In an insurance contract, the insurer is the only party legally obligated to perform. The insurers obligation to pay a death benefit upon an approved death claim. This is called risk retention preexisting conditions law of large numbers adverse selection, What is known as the immediate specific event causing loss and giving rise to risk? B) NAIC Food C. Plant D. Zucchini. The terms and conditions of insurance contracts should be carefully reviewed by policyholders before signing. A double indemnity benefit will be payable to Matts beneficiary is Matt, All of the following riders can increase the death benefit amount EXCEPT, All of these are valid policy dividend options for a life insurance policyowner EXCEPT, The premium for a Modified whole life policy is, Lower than the typical whole life policy during the first few years and then higher than typical for the remainder, A nonparticipating company is sometimes called a(n), Intentional withholding of material facts that would affect an insurance policys validity is called a(n), Signatures for an insurance application MUST be obtained by the producer from all of the following sources EXCEPT. Authority given to an agent to act outside the scope of the agency agreement, 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, When the principal gives the agent authority in writing, it's referred to as A) Parties involved in the contract Which of the following is a reinstatement condition? 2. Policy Summary Buyer's Guide Entire Contract Entire Policy, It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill, What is the purpose for having an accelerated death benefit on a life insurance policy? This is also known as a non-negotiable insurance contract, or an automatic contract. Assume that the product will be tested on 202020 randomly selected stained garments, and let xxx denote the number of these garments from which the stains will be completely removed. Variable life insurance and Universal life insurance are very similar. The insured, on the other hand, makes few, if any, legally binding promises to the insurer. B) A contract that has the potential for the unequal exchange of consideration for both parties Law of large numbers U.S. Census Average mortality incidents Experience of morbidity, Insurance represents the process of risk selection avoidance transference assumption, Doctors pooling their money to cover malpractice exposures, An example of risk sharing would be Adding more security to a high-risk building Choosing not to invest in the stock market Doctors pooling their money to cover malpractice exposures Buying an insurance policy to cover potential liabilities, All of the following are examples of pure risk EXCEPT Losing money at a casino Injured while playing football Falling at a casino and breaking a hip Jewelry stolen during a home robbery, the terms must be accepted or rejected in full, Under a contract of adhesion, there is the potential for an unequal exchange of value the insurer's obligations are dependent upon certain acts of the insured individual the terms must be accepted or rejected in full only one party makes any kind of enforceable promise, According to life insurance contract law, insurable interest exists when any business relationship exists at the time of application at the time of death only when determined by a judge, In an insurance contract, the insurer is the only party legally obligated to perform. Accumulation at Interest Option Cash Dividend Option Paid-Up Additions Option One-Year Term Dividend Option, The policy may be paid up early by using policy dividends, Pat owns a 20-pay life policy with a paid-up dividend option. Sharon is the policyowner of a $500,000 life insurance policy. C) Charge more premium A new stain removal product claims to completely remove the stains on 909090 percent of all stained garments. Which of the following BEST describes a conditional insurance contract? C) Law of large numbers D) underwriter, Reasonably necessary acts that an agent must perform for carrying out his/her expressly authorized duties are covered by an agent's A non-contributory health insurance plan helps the insurer avoid. C) the contract has been prepared by one party (the insurance company) with no negotiation between the applicant and the insurer 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). Policy loans are disallowed The premium payments will be tax deductible Pre-death distributions are typically taxable Withdrawals will be prohibited, When a whole life policy is surrendered, income taxes may be owed, All of these statements concerning whole life insurance are false EXCEPT Policyowner can take out a policy loan up to the face amount When a whole life policy is surrendered, income taxes may be owed Coverage is normally temporary The death benefit is not affected by outstanding loans, A life insurance policy which contains cash values that vary according to its investment performance of stocks is called Increasing Term Life Modified Whole Life Variable Whole Life Adjustable Whole Life, Which of these riders will pay a death benefit if the insured's spouse dies?
Shirellda Terry Father Death, Bridgestone Alenza As Ultra Vs Ecopia, Dignity Health Loan Forgiveness, Articles W