all of the following are true of insurance except

Who would be eligible to obtain SGLI? All of the following statements are true of liability insurance, EXCEPT: Answer: liability coverage indemnifies the insured. (c) face amount of the policy and the legal reserve. All of the following groups may purchase group health insurance coverage, EXCEPT: Groups must have at least two employees to be eligible for group insurance coverage. Insurance is designed to provide protection against which of the following? Annual income 1)Domestic Insurer Conditional Contract B. It requires evidence of insurability for renewal. A) loss reserves 2. -pay for certain time and stop ~~~\text{Depreciation on factory equipment}&31,000\\ d) To protect the insurer from persons who purchase life insurance with the intention of committing suicide. Term life insurance provides the largest amount of coverage for the lowest amount of premium. The insured agrees to maintain insurance equal to some specified percentage of the value of the property. ~~~\text{Rent on factory facilities}&60,000\\ a) Using arbitration when the insured and insurer cannot reach agreement B. Aleatory contract What (5) Factors for GIO & GIB. whose covered? C. Premiums are determined by age sex and occupation of each individuals certificate holder. Concerning insurance, the definition of a fiduciary is Are insurance company underwriters allowed to discriminate? If an insurer is incorporated in Rhode Island, but primarily does business in New York, what type of insurer would it be considered in New York? -7 pay test is used to determine If a policy is a MEC. B. What happens when there is a Misstatement of age or sex? C. group credit life insurance does not build cash values. Example: company that is incorporated in NJ and sells in NJ. A) the agent. 3)increase the length of coverage b) Failure to promptly settle a claim when liability has been clearly established Contract or form of ownership is a ______________? Most policies can be renewed for additional periods without evidence of insurability. -car accident not in conjunction with an illness ________________ are the person who receives benefits payable upon death. AKA-payout phase. Insurers use this law in order to predict certain types of losses and set appropriate premiums. Which of the following documents must be provided to the policyowner or applicant during policy replacement? d) Contingent. Term. What are the temporary needs? An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What are the (5) Factors considered with combination policies Who and What are they? The money in a savings account Being young and healthy means you can skip out on health insurance. All of the following are true of insurance except: a) protects against uncertainty b)means sharing of loss c)eliminates risk d)transfers risk Answer: Eliminates risk Question: Which of the following is NOT true about insurance? B. B. d) Tax-deductible. C. Medical Background \textbf{For the Month Ended October 31, 2017}\\ 2)Variable annuity has reached its final destination and can be paid out in full. Jul3125,500\begin{aligned} There is a minimum guaranteed interest rate on all sub-accounts. S buys a $10,000 Whole Life policy in 2003 and pays an annual premium of $100. All of the following are types of insurers except: The ________ Branch of the state government influences public policy regarding insurance laws. Each policy pays a percentage of the loss based on the percentage of coverage that policy provides. \text{Net loss}&&\underline{\underline{\$(23,000)}}\\ 3)semi-annual Department of Defense 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. (b) Most policies can be renewed without evidence of insurability. A policy that does not pay dividends to policyowners is a I. exclusions: when the accident occurs within an illness,disease, or mental infirmity. B. (d) Premiums increase at an increasing rate upon renewal. An annuity whose based on the stock market index? The preferred risk classification indicates that an insured is in excellent physical condition and employs healthy lifestyles and habits. All of the following statements concerning coinsurance are true, EXCEPT . a) Juvenile Life \text{Dividend}& 19,000& \text { Net Inc } & 65,000 \\ &\begin{array}{lr|lr} \end{array} \\ 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. C) A licensee cannot knowingly employ an individual who has been convicted of a felony or crime of moral turpitude within the past 10 years to act in a fiduciary capacity. c) To protect the policyowner (c) Most policies can be converted to a permanent life insurance policy. One sided contract is a ______________ contract. (b) Cash value accumulation is slow to moderate. D) Members of the uniformed forces can obtain term group life insurance through Servicemembers' Group Life Insurance (SGLI). when the applicant/owner is not the insured-3rd party See Page 1. What type of policy does the insured most likely have? All of the following statements about term insurance are trueEXCEPTa. (6). \\ Correct: B. B. It is the specific cause of loss. See Answer. Insurance companies can charge an interest rate based on the policyowner's credit report. What are two reasons that people deposit money in banks? D. group credit insurance must have a suicide clause . 4. 5)an agreement is set, 1)Level term(cheapest insurance) face value stays the same b. it frequently includes coverage for losses due to casualty and theft. The designation will be void/. All of the following are restricted persons concerning the formulation of an insurance contract except: A producer has __________ authority when he accepts premium on a lapsed policy, and the insurer reinstates the policy. Correct: C. Concealment, A. A. C. Application All of the following are required signatures on a life insurance application EXCEPT. Term life insurance provides pure death protection. D. Accident All of the following statements about the characteristics of Social Security are true EXCEPT A. The safety margin is narrower, because the cost of the insurance to the policyholder cannot be adjusted at a later time. &\text { Accumulated depr.-equipment }\\ 3)Minors. Pure risk Which of the following statements is not correct regarding rates and premiums? Since they may receive a dividend (not guaranteed), such policies are known as participating policies. The failure to disclose known facts is what? A. The insurance provides protection for a specified period of time. C) Annually renewable term policies provide a level death benefit for a premium that increases each year with the age of the insured. The accounting records of DVD Sales, Inc., include the following accounts: CashJul15,500???? When an agent collects the initial premium from the applicant, the agent should issue the applicant a. Executive office - Limited Pay Life 2)administered charge B. Nonadmitted Various life insurance programs for people who served in the military are called ______________? d) All of the above. -has cash value invested in the stock market Modification to a policy is a _______________? All of the following are true regarding health insurance policies, EXCEPT: A) An agent or producer may not make changes to the policy B) Once issued, a policy may only be changed with the approval of a company officer C) An agent may change an application with the verbal consent of the applicant 2)APS=medical records Liquidity in life insurance refers to availability of cash to the insured. Annually renewable term policies provide a level death benefit for a premium that C. A husband or wife has an insurable interest in their spouse (b) variable life insurance An insured is driving her automobile and strikes a large pothole that . An Applicant inaccurately representing information on the application is guilty of: A. C. Department of State 3)according to the source of annuity income &\text { Inventory }\\ 4)Based on principle sum(rider) & capital sum(insurer) 50%, 3rd party ownership insurers issues policy to a lending institution &\begin{array}{l|lr} An annuity is exchanged for another annuity. An agent and an applicant for a life insurance policy fill out and sign the application. b. Beneficiary's age Which of the following is NOT a fraudulent and intentional deception of the truth? Is claim still paid if there is a misstatement of age or sex? (Medic Information Bureau)? 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? They become permanently disabled c) Misrepresentation After Alex has made 20 premium payments, his life insurance policy is considered D. Premiums are tax deductible as a business expense, B. Which type of life insurance makes sense for someone in this situation? -guaranteed/fixed/level payment, -Immediate "annuitization phase" What is the purpose of a suicide provision within a life insurance policy? c) Guides describing company financial integrity The policy is a contract of adhesion a) the risk is transferred to the insurer b)the insured may retain part of the risk through deductibles . A) Universal Life policies allow for policyholders to withdraw a limited portion of the policy's cash value. \end{aligned} Participating policy. Insurance that is provided by the Federal or State Government and sex doesn't determine eligibility? A. c) Whole Life D. Alien 1) premium schedule differ from whole life -birth of child. This method of estimating . When the producer exceeds the authority expressed in the agency contract and the insurer does not take action, which type of authority is created? 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} There are 2 parties of the contract- what are they? Which of the following does not constitute the consideration in the insurance transaction? Where does group-life insurance come from? (a) renewal provision *The insured is diagnosed with terminal & chronicle illness Findefch a Wife,' 'Pnrple and Fine -men,'^The' Day of Temptation,' ' Of Royal Blood,' etc., etc . Cash value is invested in the stock market. A surplus lines broker accepts business only from non- resident agents Which risk management type is shifting the risk of loss to a larger homogeneous group? -paying for certain time and stop. Height Weight and Health conditions. &\text { Rental Class }\\ Correct: A.A peril. a) Withdrawals are not taxable. c) Policy loans are taxable distributions. Cause of potential loss to property such as fire, windstorm, hail, flood, etc. Something of value is a __________________. The insurance contract is a _________ because the court will usually interpret in favor of the insured when an insurance policy is not clear. c) 15% for early withdrawal Correct: A. B) Passing examination with 75% or higher score. Health insurance decreases your healthcare costs. What type of term do you think would be least expensive a short term or a long? What are (4) ways annuities are classified? 3) Increasing Term. Rates. A contract between insurer and policy holder. The following are all true regarding risk management, except: A. Difference between Universal Life Insurance and Whole Life Insurance? baseball, fishing | 2K views, 10 likes, 0 loves, 0 comments, 2 shares, Facebook Watch Videos from 800 Pound Gorilla Media: Robert talks about fishing in NYC, baseball, and growing up with protective. c) Copy of the original application A policy summary usually includes all the listed information, and must be delivered along with a new policy. 3. Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values, and death benefits for specific years? (b) II only The policyowner can add to a policy's cash value at any time subject to policy guidelines. d. Be prepared to justify your answer. -tax free accumulation of borrowing. C. Domestic -it is a type of Rider Hammond estimates that it will manufacture 5,000 televisions next year. All of the following are options for managing risk, except: means of collecting a loss payment from a liable party. Applicant pays premium to make agreement. If a change in the application is necessary what is required? d) Decreases annually. 3)low premiums. ~~~\text{Insurance expense}&\underline{8,000}&\underline{803,000}\\ 3)Explain any riders or exclusion 5)Survivorship Life Policy (policy holder pays themselves). b. 10 year level term Correct: C. Condition contract, enforceable only under certain conditions. Traditional insurance policies contain a list or description of excluded "perils" (that which causes a loss). All of the following are business uses of life insurance EXCEPT b) Distributions before age 59 1/2 incur a 10% penalty on policy gains. Limited-Pay Life & Single-Premium Policies? S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. 3. 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. 4)decrease premium paying period. Question: 55. C) Completing pre-licensing training. The parties in the insurance contract consist of whom? \end{array} C) common stock 4. A. All of the following statements about term insurance are true EXCEPT. D. The face amount remains the same throughout the life of the policy. Why do most states have a waiting period for couples applying for marriage licenses? \end{array} (d) They remain level. A _______ __ is the additional premium needed to get covered with high or substandard risk. -guarantee a stream of income to the person purchasing it known as the annuitant. Get more out of your subscription* Access to over 100 million course-specific study resources When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable statement of good health Cash values can be borrowed at any time -kids till 21 Waiver of premium is a rider that can be added to a life insurance policy, and not something to be obtained from the applicant. A. (c) both I & II (d) neither I or II. Part 1 of the application includes the general questions about the applicant, including name, age, address, birth date, gender, income, marital status, and occupation. Any gain in the policy's cash value is . What constitutes the acceptance of an offer? RetainedEarningsDividend19,000Jul1NetIncJul3165,00065,000111,000. \hline (\$ 000) & 1 & 2 & 3 & 4 \\ Who is responsible for making sure the application is completed properly and all necessary info is obtained? considers Lloyds of London an Alien insurer b. Policyholders Age, Sex, Occupation, Hobbies, Habits, Smoking or Non-Drug user or Non. It is used to pay off the balance on the mortgage. 1) All requirements are met Errors and Omissions Coverage (E&O) is a name used to describe a type of professional liability insurance. Arrest History. "Round Tree Manor is a hotel that provides two types of rooms with three rental classes: Super Saver, Deluxe, and Business. . The cost of a living rider is calculated by what? IRS classification of a policy that is overfunded? b) Unilateral -Both parties must follow certain conditions set forth in contract, -IRS classification of a policy that is overfunded 3)mortality charge. Costs of training a replacement 3)Family Policy(Limited but all fam members paid) b. persistent fear of germs The insurer that is transferring the risk to another company is called the ____________ __________. What type of interest does universal life have? The policy is issued for one year and may be renewed annually with evidence of insurability. and is NOT a party to the contract. It does not include breach of contract. B. IRS has no jurisdiction What is used for the underwriting department to determine insurability? b. Group life insurance is most often issued as guaranteed annual renewable term. Receipt A company that does business in another state than incorporated who is owned by policyholders who received dividends when declared and voting rights. Pro rata liability applies. (Choose from the following options) What else must he include? B. All of the following are true of key person insurance EXCEPT ) The key employee is the insured. Long-term investment decision, payback method Bill Williams has the opportunity to invest in project A that costs $9,000 today and promises to pay annual end-ofyear payments of$2,200, $2,500,$2,500, $2,000, and$1,800 over the next 5 years. The face amount decreases as the amount owed on the mortgage decreases. Which of the following best describes a surplus lines broker? Jason Mackenzie Alexander argues morality is a form of social technology - it is context specific and it can go out-of-date Which of the following information about the applicant is NOT included on Part 1 of the application for life insurance. D. They can decide when to pay their monthly premiums. a) Consumer Privacy Act The corporation also helps detect and prevent insurer impairments. C. Social Security works exactly same as private insurance. Correct: A. a surplus lines broker places risks with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers. b) Fixed income (c) term insurance Medical exams provide information on current health. D. A surplus lines broker places risks with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers M327. Life insurance proceeds 4)defined contribution plans. The terrorism risk insurance program reauthorization act provides for a terrorism insurance program administered by which federal entity? The Human Life Value Approach to determining the value of an individual's life requires the calculation of probable future earnings of the insured, which involves wages, expenses, inflation, amount of time until retirement, and the time value of money. (c) both I & II (d) neither I nor II. D. Represent the insured's interest All of the following characterize term life insurance, EXCEPT: Select one: a. 3) Retaining the risk. D. Claim History (c) both I & II (d) neither I or II, Diane is a single parent. b) The elderly The correct answer is: The premium decreases to zero by the end of the policy period. Insurance is designed to cover both intentional and unintentional losses. 2)when benefits begin B. Buy-Sell Agreements pay in the event of a medical emergency What is the MIB? The death benefit varies according to investment experience. -the premiums are paid for a limited time only. 3)MIB=records of all previous insurances they had. Due to climate change, premiums are going up for certain types of insurance, such as flood insurance. 2)no cash-value Yes, all T-mobile insurance plans cover water damage. Whats the "take it or leave it contract"? An inexperienced assistant accountant has prepared the following income statement for the month of October 2017. Life expectancy has increased in the U.S. over the last century. \text { Type II } & \$ 20 & \$ 30 & \$ 40 -age 100. Question: All of the following statements about professional liability insurance are true, EXCEPT: Select one: O a. Cash values are available in whole life policies. C. Tax Status a) Types of mutual companies still matures at age 100, -premium is paid off at one time Joe, Larry, and Curly own a small business. 3)substandard-highest, 6 factors that are complete for policy 2 be paid? Tom and Nancy Boyle provide financial support for their two children. \hline & \text { Jul 31 } & 19,500 The benefit is subject to the exclusionary rule (a) Evidence of insurability is not required to renew the coverage. It is most appropriate when an insured needs lifetime protection. B. Misrepresentation &\begin{array}{cr|} c) Needs approach c) Counselor Some life insurance policies offer cash values that can be borrowed at any time and used for immediate needs. What happens when a policy is surrendered for its cash value? If the insurance carried is less than required, the insurance may not cover the whole loss. d) Producer. c. Which of the following statements is NOT true concering insurable interest as it applies to life insurance? Eight Summoning Eyes need to be placed to summon the Ender Dragon and players need to have 450 Dragon Weight to have a chance of getting the sword. Warranty Business partners have an insurable interest in each other d) The Guaranty Corporation. DepreciationExpense-FactoryEquipmentDepreciationExpense-BuildingHeat,Light,andPowerExpenseInsuranceExpense-Factory$5,770.242,822.409,055.201,505.28MiscellaneousExpense-FactoryPayrollTaxesExpense-FactoryPropertyTaxExpense-FactorySuppliesExpense-Factory$13,780.4843,736.006,088.3218,063.36. d) Performing reviews of insured's coverage. Benefits received are considered income taxable c) An agent offers tickets to a baseball game as an inducement to buy insurance. A conditional contract requires both the insurer and policyowner to meet certain conditions before the contract can be executed, unlike other types of policies, which put the burden of condition on either the insurer or the policyowner. (b) face amount of the policy and the total premiums that have been paid. An Insurance Broker is responsible for what? The profit per night for each type of room and rental class is as follows: RentalClassRoomSuperSaverDeluxeBusinessTypeI$30$35TypeII$20$30$40\begin{aligned} \text { Room } & \text { Super Saver } & \text { Deluxe } & \text { Business } \\ A. D) Insurance covers intentional losses as well as unintentional. (3), WHat is the difference between universal and whole life policies? A. b) The policy will not be affected. The 4 characteristics of a universal life policy are? A ______ will receive unfavorable tax treatment. & &&\textbf{ Quarter } \\ & \text { Depr } & 3,000 \\ Payor benefit/Clause is always a _________. Who gets $$money when the policy holder dies? Life insurance prodceeds Empire Company is a manufacturer of smart phones. d) Blackout approach. Increasing term \end{array} Which of the following about the use of ordinary life insurance is true? B. Marital Status (b) tax-free exchange provision 2) premiums do not change . (D The employer is the owner, payor and beneficiary of the policy. An insurer that was incorporated in a different state that it is doing business in. The issuance of a binder is the result of the ___________________ of an offer. Indicate by a plus (+)(+)(+), minus ()(-)(), or zero (0)(0)(0) if the factor would increase, decrease, or have an indeterminate effect. d) Fiscal responsibility. Attempting to determine how much insurance an individual would require based upon their finacial objectives is known as. Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, ICEN6003: IC Engines Operation and Constructi. The insurer issues the policy and learns of his history one year later. Rates Copyright 2009-2022 Tests.com LLC - All Rights Reserved. You cannot sell a variable policy without what? \textbf{EMPIRE COMPANY}\\ Long term- the longer the policythe more spread out the policy premiums are. 2)Explain and collect any ratings 1) the premium amount Company A carries 1/3 of the total coverage ($20,000 + $40,000 = $60,000). The correct answer is: Premiums are typically paid by the lender. Address of his principal office All of the following are true of insurance EXCEPT It transfers risk. 3. 2)explain any ratings The County is administered by a five-member Board of Supervisors who are elected for four-year terms 1)cont. &\text { Retained Earnings }\\ Accumulateddepr.-equipmentJul1DeprJul3155,0003,00058,000, RetainedEarningsJul165,000Dividend19,000NetInc65,000Jul31111,000\begin{aligned}

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