NY LIFE INSURANCE EXAM REVIEW

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NY LIFE INSURANCE EXAM REVIEW

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -75 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: Which of the following statements about the reinstatement provision is true?

• It requires the policyowner to pay all overdue premiums with interest before the policy

is reinstated

• It permits reinstatement within 10 years after a policy has lapsed
• It provides for reinstatement of a policy regardless of the insured's health
• It guarantees the reinstatement of a policy that has been surrendered for cash

Answer:

• It requires the policyowner to pay all overdue premiums with interest before the policy is reinstated

Upon policy reinstatement, the policyowner will be required to pay all back premiums plus interest, and may be required to repay any outstanding loans and interest Question 2: The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?

• As of the policy delivery date
• As of the first of the month after the policy issue
• As of the policy issue date
• As of the application date

Answer:

• As of the application date

If the full premium was submitted with the application and the policy was issued as requested, the policy coverage effective date would generally coincide with the date of application Question 3: Can the Superintendent investigate fraudulent claims if they occurred outside of the resident's state according to the Insurance Fraud Prevention Act?

• Yes. The Superintendent has the power to make an investigation within this state or outside

of the state

• Yes, but only if it is a violation of another state's insurance law
• No. Because insurance is regulated by the state, all claims must occur within state

boundaries

• No. If fraudulent acts are believed to have been committed, the Superintendent must notify

the state's Superintendent or Commissioner. It will then become a federal matter

Answer:

• Yes. The Superintendent has the power to make an investigation within this state or outside of the

state If the insurance frauds bureau has reason to believe that a person is engaged or is about to engage in a fraudulent act, the Superintendent has the power to make an investigation within this state or outside the state Question 4: Which of the following is the closest term to an authorized insurer?

• Licensed
• Legal
• Admitted
• Certified

Answer:

• Admitted

Insurers who meet the state's financial requirements and are approved to transact business in the state are considered authorized or admitted into the state as a legal insurer

Question 5: Which of the following is NOT a type of whole life insurance?

• Single premium
• Straight life
• Limited payment
• Increasing term

Answer:

• Increasing term

There are several types of whole life policies. The first three, Straight Life, Limited Payment, and Single Premium, are the basic forms of whole life. Increasing term is a type of term insurance

Question 6: Which of the following is NOT a goal of risk retention?

• To increase control of claim reserving claim settlements
• To fund losses that cannot be insured
• To minimize the insured's level of liability in the event of loss
• To reduce expenses and improve cash flow

Answer:

• To minimize the insured's level of liability in the event of loss

Retention usually results from three basic desires of the insured: to reduce expenses and improve cash flow, to increase control of claim reserving and claim settlements, and to fund losses that cannot be insured Question 7: A perspective insured receives a conditional receipt but dies before the policy is issued. The insurer will

• Pay the policy proceeds up to an established a limit
• Not pay the policy proceeds under any circumstances
• Automatically pay the policy proceeds
• Pay the policy proceeds only if it would have issued the policy

Answer:

• Pay the policy proceeds only if it would have issued the policy

The conditional receipt says that coverage will be effective either on the date of the application or the

date of the medical exam, whichever occurs last Question 8: Which of the following riders will NOT cause the Death Benefit to increase?

• Accidental Death Rider
• Payor Benefit Rider
• Guaranteed Insurability Rider
• Cost of Living Rider

Answer:

• Payor Benefit Rider

Payor Benefit Rider does not increase the Death Benefit; it only pays the premium if the payor is disabled or dies. With Guaranteed Insurability Rider, the policyowner can increase DB at specified ages or events, i.e. marriage or birth of a child; Cost of Living Rider increases DB to keep pace with inflation; in Accidental Death Rider, if the insured dies from an accident, DB is a multiple of the Face Amount Question 9: Which of the following is NOT required on an illustration used in the sale of a life insurance policy?

• Name of insurer
• Underwriting or rating classification upon which the illustration is based
• The name of the primary and secondary beneficiaries
• Generic name of policy

Answer:

• The name of the primary and secondary beneficiaries

Other required items include the name and business address of producer or insurer's authorized representative; the name, age and sex of proposed insured; underwriting or rating classification upon which the illustration is based; and the initial death benefit Question 10: Attempting to determine how much insurance an individual would require based on their financial objectives is known as

• Human Life Value Approach
• Estate Planning
• Viatical Approach