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57 Cards in this Set
- Front
- Back
- 3rd side (hint)
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This provision will waive premium payments on a juvenile policy if the premium payor dies before insured child's age 25? |
Death of Payor benefit |
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Which of the following is a purpose of naming a contingent beneficiary? |
To avoid having life insurance death benefits paid to the primary beneficiary's estate |
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Dividends? |
The owner has the right to choose the dividend option |
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Guaranteed Insurability provision allows? |
The insured may purchase additional amounts of insurance at specified intervals with no evidence of insurability. Unless he passes up an opportunity |
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When borrowing against a Whole Life Policy |
One must pay the interest rate indicated in the policy or it will be added to the policy loan |
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A Nonforfeiture Option |
If the Paid Up Insurance option is chosen, no further premium payments are necessary |
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Nonforfeiture options are |
1. Cash 2. Paid-Up Insurance 3. Extended Term insurance |
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With an Aviation Exclusion is an individual covered on a commercial flight? |
Yes |
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Right of ownership in a life insurance policy includes? |
1. Change settlement options 2. Receive dividends 3. Borrow against the policy |
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If policy owner is someone other than insured what applies |
1. The owner must have insurable interest in the insured life 2. The owner must sign the application 3. Insured must sign application |
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Who cannot be an owner in a life insurance policy? |
1. A disinterested third party that has no financial interesting the insured's life |
The insured, a family member, and a creditor can be. |
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A lady said she was 28 when she purchased her life insurance policy when really she was 30? |
Insurance co is allowed to reduce benefits to what it would normally pay for a person of the insured's actual age |
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what is the waiting period after someone purchases a life insurance policy to it will pay on a suicide? |
Two Years |
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Premium Payment clause states: |
1. must be paid in advance 2. Premium payment mode means a)frequency of payment)method of payment |
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10 Day Look Provision |
give the insured ten days from date of delivery to return the prelacy w/out premium charge for any reason |
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Group Insurance Policy Participation requirement |
Its purpose is to avoid adverse selection |
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Who qualifies for group insurance. individually apply & each have policy issued to them but program administered by sponsor? |
1. Group Insurance 2. Key Employee Insurance 3. Industrial Life Insurance |
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Group insurance? |
Each covered person is issued a certificate |
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Cost savings typically associated with group insurance |
1. Very little individual underwriting 2. No MIB reports, credit reports or inspection reports 3. Master policyholder assists in administration by payroll red pre |
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Groups eligible for group life insurance |
1. Ten or more debtors of a creditor |
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Tax-Sheltered annuity (TSA) |
It can be established through a life insurance company annuity plan or mutual funds |
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Tax-Sheltered Annuity(TSA) Plan |
Only employees of non-profit education, religious or medical organizations are eligible |
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IRA Plan |
Any wage earner qualifies |
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Individual Retirement Account (IRA) |
Any wage earner is eligible |
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(IRA) Individaul REtirement Account |
They can be set up through life insurance company annuity plans |
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25 Annuity Plans can be purchased as |
1. a separate contract in itself 2. a rider to a life insurance policy 3. part of pension plan |
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24 An Annuity options that would yield payments in a fixed amount each month until principal and interest are depleted |
Fixed amount |
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23. A plan that Provides cash accumulation which varies according to a specified economic index and is intended to combat inflation |
Variable Annuity |
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22. A Buy-Sell Agreement is |
A business agreement that provides for the surviving partner/stockholder of a business to buy out another at his/her death |
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Buy-Sell Agreement |
A type of plan that would typically be entered into between partners |
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20 Social Security Death (Survivor) benefits |
The covered individual has to have achieved either currently insured or fully insured status prior to death |
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Social Security Death (Survivor) benefits |
1.Benefits can be paid to widows who have dependent children under age 16 2.widows/windowers have to have children to qualify |
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Key Employee Life Insurance Plan accomplishes |
Provide a business operating cash at the death of a key executive |
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A Whole Life Insurance policy with a Decreasing Term rider with benefits used to provide a family income |
Family Life Insurance Plan |
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A Characteristic of Term Insurance |
Insurance protection for a limited policy term |
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Common reasons for buying Term insurance |
1 Protect installment loans 2 Protect Mortgage 3 Protect against loss of income |
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Has the highest cash value build up |
Endowment Insurance
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Policy with the highest premium rate |
Endowment Insurance |
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Policy requires premium payments for the longest period of time |
Whole Life |
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Why Purchase Whole Life |
1. Level premium rate during life of policy 2. Cash values p.owner can borrow against 3. Nonforfeiture options which the owner can obtain at surrender |
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Term Insurance Characteristic |
Insurance protection for a limited policy term |
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Common reasons for buying Term insurance |
1. Protect Mortgages 2. Protect Installment loans 3. Nonforfeiture options |
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Policy with the highest cash value build up |
Endowment Insurance |
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A Policy requires premium payments for the longest period of time |
Whole Life Insurance |
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Why purchase Whole Life Insurance |
1.Level premium during life of policy 2. Cash values that the policy owner can borrow against 3. Nonforfeiture options which the owner can obtain at surrender |
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A Temporary Insurance agreement |
Is replaced at a later date with a permanent policy with no evidence of insurability |
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If insured does not pay the premium with the application when does the policy take effect |
Upon delivery |
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A life insurance policy that the premium was paid with application takes effect |
Upon completion of the application including the required physical exam |
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A life insurance company can rate up a policy by |
Charging a temporary surcharge |
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Fair Credit Reporting Act protects which of the following applicant's rights |
The right to be notified that there could be an inspection |
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What are consideration in evaluating an application for life insurance |
1. Attending physician's statement 2. Moral Characteristics and risks 3. Occupation |
2.. |
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In evaluating an application An underwriter would consider |
a parents serious illness |
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Who must have insurable interest? |
The beneficiary if he/she is the policyowner |
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a financial interest which the policy owner must posses at the imd that a life insurance policy is purchased is |
insurable interest |
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It is important to have a large group of individuals insured because |
according to the law of large numbers , the larger the group the more accurate actuarial statistical assumptions will become |
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Why would someone not buy life insurance? |
To cover living expenses while disabled |
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why would someone buy life insurance? |
1. to pay funeral expenses at the death 2. to pay taxes at her death 3. to protect family against loss of income should someone die prematurely |
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