FINAL EXAM - NORTH CAROLINA LIFE AGENT

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FINAL EXAM - NORTH CAROLINA LIFE AGENT

Qs and Ans - Expert- Explanation - ing score -100 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: ABC Insurance Company fails to pay death proceeds after satisfactory proof of loss was submitted. ABC must then begin paying interest on the death proceeds after __ days of receiving proof of loss.

Answer:

30 Question 2: When a misrepresentation on a life insurance policy application is discovered, what action may an insurance company take?

Answer:

Void the policy only if it is discovered during the Contestable period and proven to be material Question 3: How long does the coverage normally remain on a limited-pay life policy?

Answer:

Age 100 Question 4: Which of the following is TRUE about a qualified retirement that is "top heavy"?

Answer:

More than 60% of plan assets are in key employee accounts

Question 5: T would like to be assured $10,000 is available in 10 years to replace a roof on his house. What kind of $10,000 policy should T purchase?

Answer:

Ten-Year Endowment Question 6: Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following contr elements?

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Legal Purpose (Insurable Interest) Question 7: A life insurance application must be signed by all of these EXCEPT:

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Beneficiary Question 8: T, age 70, withdraws cash from a profit-sharing plan and purchases a Straight Life Annuity. What will this transaction provide?

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Income that cannot be outlived by the owner Question 9: What type of life policy covers two people and pays upon the death of the last insured?

Answer:

Survivorship Question 10: All of these are characteristics of an Adjustable Life policy EXCEPT

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face amount can be adjusted using policy dividends Question 11: Variable annuities may invest premiums in each of the following, EXCEPT:

Answer:

Insurer's corporate business account

Question 12: What is considered to be a characteristic of an immediate annuity?

Answer:

Benefit payments start within one payment period of purchase

Question 13: What kind of life insurance starts out as temporary coverage but can be later modified to permanent coverage without evidence of insurability?

Answer:

Convertible Term Question 14: Credit life insurance is typically issued with which of the following types of coverage?

Answer:

Decreasing term Question 15: Which of the following statements is correct about accele death benefits?

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Must have a terminal illness to qualify Question 16: The Consideration clause in a life insurance contract contains what pertinent information?

Answer:

Amount of premium payments and when they are due Question 17: A retirement plan that sets aside part of the company's net income for distributions to qualified employees is called a

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profit-sharing plan Question 18: Which type of policy is considered to be overfunded, as stated by IRS guidelines?

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Modified Endowment Contract Question 19: The Commissioner may exempt an applicant from the licensing exam if an

applicant has obtained any of the following designations, EXCEPT:

Answer:

Chief operating officer (COO)

Question 20: Anyone who knowingly provides an untrue, false or fraudulent claim to an

insurance company is guilty of:

Answer:

a felony Question 21: According to North Carolina's rules on disclosure, a life insurance applicant is expected to be provided with

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a Buyer's Guide and Policy Summary Question 22: A life policy loan in North Carolina cannot charge a fixed rate of interest higher than

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8% Question 23: A policy that becomes a Modified Endowment Contract (MEC):

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will lose many of its tax advantages Question 24: On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?

Answer:

Collect initial premium along with a signed health statement Question 25: Which premium schedule results in the lowest cost to the policyowner?

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Annual Question 26: Each agent who initiates an application for life insurance or annuity for replacement of an existing policy shall submit which of the following as a part of the application?

Answer:

A signed statement by the applicant regarding the replacement