Under the McCarran-Ferguson Act, what is the minimum penalty for this? Shirley has a $500,000 10-year-non-renewable level term life policy. Policy Application Riders Certificate of Authority, A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n) guaranteed term rider guaranteed insurability rider accelerated benefit rider cost of living rider, The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period from the policy's inception, the insurer will only be liable for a return of premiums paid minus indebtedness and with interest during the last 12 months minus indebtedness and without interest during the last 6 months, A life insurance policyowner does NOT have the right to change a beneficiary select a beneficiary take out a policy loan revoke an absolute assignment, A life insurance policy normally contains a provision that restricts coverage in the event of death under all of the following situations EXCEPT fare-paying passenger pilot of personal airplane suicide war, The insurer's obligation to pay a death benefit upon an approved death claim, Under a life insurance policy, what does the insuring clause state? A contract that requires certain conditions or acts by the insured individual A contract that has the potential for the unequal exchange of consideration for both parties A contract where one party "adheres" to the terms of the contract A contract where only one party makes any kind of enforceable contract, statements made in the application and the premium, In a life or health insurance contract, "consideration" would be the offer and acceptance premium only statements made in the application and the premium statements made in the application only, According to the principle of Utmost Good Faith, the insured will answer questions on the application to the best of their knowledge and pay the required premium, while the insurer will deal fairly with the insured and it's underwriting issuance of the policy promises made legal reserve, All of the following are elements of an insurance policy EXCEPT definitions other insurance claim forms conditions, The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as Apparent Estoppel Aleatory Unilateral, Which of the following is an example of the insured's consideration? If Sharon MUST obtain Mikes signature in order to change the beneficiary, what kind of beneficiary designations is this? The above question Which of the following BEST describes a conditional insurance contract?, Was part of Insurance MCQs & Answers. How does life insurance create an immediate estate? D) an offer and acceptance of the contract terms, D) an offer and acceptance of the contract terms, In an insurance contract, the applicant's "consideration" is the Interest on policy loans is tax deductible Premium payments are tax deductible Pre-death distributions will become taxable Cash value cannot be surrendered early, seeks temporary protection and lower premiums, Term insurance is appropriate for someone who seeks living benefits for themselves seeks a policy that builds cash value seeks temporary protection and lower premiums seeks permanent protection and higher premiums, Shirley has a $500,000 10-year non-renewable level term life policy. Under a life insurance policy, what does the insuring clause state? A) underwriting both parties consent to the contract. warranty guarantee representation collateral, there must be legal reasons for entering into the contract, Legal purpose is a term used in contract law meaning there must be an offer and acceptance the contract must be aleatory there must be legal reasons for entering into the contract the contract must be a contract of adhesion, In an insurance contract, the element that shows each party is giving something of value is called offer acceptance consideration purpose, What makes an insurance policy a unilateral contract? Restoring an insured to the same condition as before a loss is an example of the principle of. Which dividend option would an insurer invest the policyowners money and add any interest earnings as the dividends accrue? Which of the following best describes how you analyze a fiction text (A) Both parties to the contract are bound to the terms. D) misrepresentation, Which of the following is NOT required in the content of a policy? A) warranty Chapter3. Legal Concepts of the Insurance Contract conditional Peril Hazard Loss factor Liability, Which of these techniques will remove the risk of losing money in the stock market by never purchasing stocks? Authority given to handle claims and process payments Her son, Mike, is the beneficiary. WINDOWPANE is the live-streaming app for sharing your life as it happens, without filters, editing, or anything fake. If xxx actually turns out to be 131313, what do you think of the claim? $1,000 $3,000 $5,000 $7,000, A nonparticipating company is sometimes called a(n) alien insurer mutual insurer reinsurer stock insurer, Because dividends are considered to be a return of premium, Why are dividends from a mutual insurer not subject to taxation? B) other insurance Provide funds to help fund retirement Provide funds to help pay taxes Provide funds for funeral expenses Provide tax deductions for premium payments, lower than the typical whole life policy during the first few years and then higher than typical for the remainder, The premium for a Modified whole life policy is higher than the typical whole life policy during the first few years and then lower than typical for the remainder lower than the typical whole life policy during the first few years and then higher than typical for the remainder normally graded over a period of 20 years level for the first 5 years then decreases for the remainder of the policy, The type of policy which pays on the death of the last person is called joint life survivorship life dual life shared life, A life insurance policy that is subject to a contract interest rate is referred to as adjustable life group life term life universal life, a policy that is paid up after only one payment, A single premium cash value policy can be described as a policy that is paid up after only one payment a policy that only requires an annual payment a policy that is guaranteed issue a policy that covers two or more lives, A limited payment whole life policy provides protection for 20 years lifetime protection protection for more than one person discounted premiums, A policyowner may change two policy features on what type of life insurance? It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance. D) underwriter, Reasonably necessary acts that an agent must perform for carrying out his/her expressly authorized duties are covered by an agent's Loans obtained by a policyowner against the cash value of a life insurance policy. Which type of life insurance policy is this? Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium". Which of the following BEST describes a conditional insurance contract? If she dies 15 years after the policy's inception date, how much will her beneficiary receive? AzAnswer team is here with the right answer to your question. performance is conditioned upon a future occurrence. Parent and children The agent's obligation to provide the proper amount of coverage The insurer's obligation to return all premiums upon an approved death claim The insurer's obligation to pay a death benefit upon an approved death claim The agent's obligation to pay a death benefit upon an approved death claim, Of the following dividend options, which of these is taxable? Insurer's promise to pay benefits D) Risk insured against, A professional liability for which producers can be sued for mistakes of putting a policy into effect is called Which military service exclusion clause would pay upon his death? B) Contract of adhesion Authority given in writing to an agent in the agency agreement Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties Authority given to handle claims and process payments Authority given to an agent to act outside the scope of the agency agreement, The authority granted to a licensed producer is provided via the producer's apparent authority written contract Law of Agency Principal Capacity, Insurable interest does NOT occur in which of the following relationships? Who prosecutes crimes that involve the violation of insurance laws that fall under US Code 1033? Which of the following best describes a symbol Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed on Ken? Insurance Cram Ch. 6 Flashcards | Chegg.com Waiver of premium Juvenile waiver Guaranteed insurability Payor benefit, Which of the following is a reinstatement condition? What kind of policy is this? Period of time after the initial premium is paid and before the policy is issued Period of time it takes for a policy's underwriting to complete Period of time after a policy is issued and before it is delivered to policyowner Period of time after the premium is due but the policy remains in force, Life insurance policies will normally pay for losses arising from commercial aviation war suicide hazardous jobs, A policyowner may exercise which of these dividend options that uses the dividend to pay all or part of the next premium due? A life insurance contract guarantees to the beneficiary not only a death benefit, but a payment of a sum of money in perpetuity, called a death benefit for that purpose of insurance coverage. Reduction of premium dividend option Extended term option Paid-up option Cash dividend option, Net death benefit will be reduced if the loan is not repaid, Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. Which of the following does a producer NOT have a fiduciary responsibility to? Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index. there is the potential for an unequal exchange of value (D) Only one party is legally bound to the contract. C) A contract where one party "adheres" to the terms of the contract The terms and conditions of insurance contracts should be carefully reviewed by policyholders before signing. Barbaras policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. Only the insurer is legally bound A) Only the insured pays the premium insured B) implied authority A type of group that has a constitution and bylaws and has been organized for purposes other than obtaining insurance is called a(n). The coverage, conditions, and limitations in the master policy of a group contract can be found in which document? His insurance agent told him the policy would be paid up if he reached age 100. Insurance Quiz (MCQs) Archives - Management Notes Which of the following best defines diction? A. simile B - Weegy B) Period to which the coverage exists Provide an opinion. A) insured Which scenario would most life insurance policies exclude coverage for? Rob recently died at age 60. A contract that requires certain conditions or acts by the insured individual. Policyowner may increase or decrease the premium payments Policyowner may increase or decrease the face amount Policyowner can contribute large sums of money Policyowner has the right to select the investment which will provide the greatest return, All of the following riders can increase the death benefit amount EXCEPT Cost of Living Waiver of Premium Accidental Death Rider Guaranteed Insurability, Which of these is NOT considered to be a common life insurance nonforfeiture option? The automatic premium loan provision authorized an insurer to withdraw from a policys cash value the amount of, Past due premiums that have not been paid by the end of the grace period. which of the following best describes a conditional insurance contract Accumulation at Interest Option Cash Dividend Option Paid-Up Additions Option One-Year Term Dividend Option, The policy may be paid up early by using policy dividends, Pat owns a 20-pay life policy with a paid-up dividend option. What is a corridor in relation to a Universal Life insurance policy? Insurable interest Insurance exchanges Law of large numbers and risk pooling Population table data, People with higher loss exposure have the tendency to purchase insurance more often than those at average risk. One-sided or unfair insurance contracts can, however, exist if they contain provisions that disproportionately benefit one party. Only the insured pays the premium The Fair Credit Reporting Acts main purpose is to, Protect consumers with guidelines regarding credit reporting and distribution, A whole life insurance policy accumulated cash value that becomes, The policy loan value which the insured may borrow against. When initial premium is collected and policy is issued. What is the meaning of par value of stock with respect to the corporate form of organization? promises made It allows for a spouse to be added as a rider to a life insurance policy It allows for policy loans to be advanced to the insured in the event of unemployment It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill It allows for a third party to purchase a life insurance policy at a discounted rate and immediately advance a portion of the death benefit, All of these are standard exclusions found in a life insurance policy EXCEPT hazardous occupations aviation disability war, Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue? This is called risk retention preexisting conditions law of large numbers adverse selection, What is known as the immediate specific event causing loss and giving rise to risk? 1 pt. A) Contract may be accepted or rejected by the insured, The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as. Bilateral Contract: Definition, How It Works, and Example - Investopedia Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. This rider is called a(n). C) Bob's spouse Which of the following BEST describes a conditional insurance contract?