PEARSONVUE LIFE INSURANCE PRACTICE EXAM

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PEARSONVUE LIFE INSURANCE PRACTICE EXAM

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 a Renewable Term policy is

CORRECT?

Answer:

It is renewable at the option of the insured.Question 2: In which of the following contracts is the Death benefit called the principal sum?

Answer:

Accidental Death and Dismemberment (AD&D) Question 3: Controlled business is defined as insurance a producer writes on all of the

following individuals EXCEPT the producer's:

Answer:

neighbors Question 4: All of the following groups are considered eligible for group life insurance EXCEPT:

Answer:

volunteer religious groups Question 5: Federal income tax laws generally treat proceeds of life insurance policies as:

Answer:

nontaxable

Question 6: The Life Insurance and Annuity Replacement Rule is designed for which of the following purposes?

Answer:

To ensure that policyowners receive adequate information on which to base a replacement decision Question 7: R has just graduated from law school. R knows that R's future earnings will be much higher than they are now, but wants to purchase a permanent policy now to cover future needs. Which of the following policies would BEST suit R's needs?

Answer:

Modified Whole Life Question 8: Which of the following terms may be used in advertisements for life insurance?

Answer:

Universal Life Plan Question 9: Which of the following statements about Credit Life insurance is CORRECT?

Answer:

it may be provided through a group or individual policy.Question 10: In order for nonresident applicants to be eligible for an insurance producer license

in this state, they MUST:

Answer:

hold a like license in another state Question 11: An insurance producer takes an application for a life insurance policy but does not collect the initial premium. On delivery of the policy to the proposed insured, the producer must collect the initial premium and which of the following?

Answer:

The insured's signed statement of continued good health Question 12: Which of the following features allows an insurance policy to remain in force for a specified number of days beyond the premium due date?

Answer:

Grace Period provision

Question 13: Which of the following policies is an interest-sensitive form of permanent protection?

Answer:

Universal Life Question 14: Which of the following statements is NOT correct about representations?

Answer:

They are true in every respect.Question 15: An individual appointed by an insurance company to solicit applications for a

policy of insurance on its behalf is known as:

Answer:

an insurance producer Question 16: If life insurance policy applicant is classified as a substandard risk, the insurance

company will MOST likely:

Answer:

charge an extra premium Question 17: An employer can deduct premium payments as an ordinary business expense for which of the following life coverages?

Answer:

Group Question 18: An individual who, for the purpose of collecting premiums, acts for another in

negotiating a contract of insurance is considered to be:

Answer:

a producer Question 19: An insured intentionally understates her age on her application for a life policy. At death, the insurer will take which of the following actions?

Answer:

Pay a reduced Death benefit based on the insured's actual age

Question 20: A payor benefit rider provides which of the following benefits?

Answer:

A temporary waiver of premium should the payor die, until the insured reaches a predetermined age Question 21: If an applicant for life insurance submits a completed application to a producer

without paying the first premium, coverage becomes effective when the:

Answer:

policy is delivered and the premium paid Question 22: Which of the following types of insurance policies is EXEMPT from the Life Insurance and Annuity Replacement Rule?

Answer:

Group Life Question 23: A Variable Life contract must contain all of the following provisions EXCEPT:

Answer:

Accidental Death

Question 24: Which of the following situations is considered rebating?

Answer:

A producer returns a portion of the commission to an insured.Question 25: In the event of an insured's death, which of the following provides an income for the family during a designated period of time followed by a lump sum death benefit?

Answer:

Family Income rider Question 26: An insurance producer who makes false statements that harm the reputation of

another insurance company is guilty of:

Answer:

defamation Question 27: Which of the following annuities would BEST suit the needs of a 35-year-old factory worker who is concerned about inflation and wants to establish a retirement plan?

Answer:

A Flexible Premium Variable Annuity