IC TRAD EXAM 1

If the interest on a policy loan is not paid at the policy anniversary, the insurance company may

• Demand full settlement of the loan

• Terminate the contract

• Refuse to grant future additional loans

• Increase the present loan by the interest

The extent of the medical evidence required is determined by

• The age of the applicant and the proposed sum to be insured.

• Occupation of the applicant.

• Financial condition of the applicant

• Data of the last medical examination.

Indicate which of the following is not a function of an application for life insurance policy

• To give details pertaining to non-forfeiture options

• To furnish Information on which contract of life insurance may be written

• To furnish initial in form atoll as to insurability

• To convey to the company the desire of the applicant to obtain insurance.

The insurance companies make use of the laws of probability in order to

• Estimate future death rates among members of a given group.

• Predict when an individual insured will die

• Develop statistics of past deaths among the general population.

• Determine the experienced death rate among insured persons

Which of the following statements regarding insurance premiums is false.

• Cash is required for all premiums paid in the grace period

• A premium is the legal consideration needed to effectuate a life insurance policy

• The grace period is usually 31 days

• Premiums which are paid quarterly or semi-annually are higher than those paid annually

Endowment life insurance and term life insurance are similar in that both plans

• Build up cash value rapidly in the early policy years

• Provide for payment of the face amount if the insured is alive at the specified period

• Provide life insurance protection for only the period of time specified in the policy contract.

• Contain provisions for automatic continuation. of the insurance protection at the end of a specified period

A non-forfeiture option would ordinarily be selected at the time a policy owner

• Renews a term life policy

• Converts a term policy to a whole life policy

• Chooses a mode of settlement for the life proceeds

• Discontinues premium payments for a whole life or endowment policy

The conservation of a life insurance policy is dependent on all the following except

• The level of first year commission

• Agent's service oriented attitude

• Pressure selling

• The use of effective needs selling

Purchasing a continuous-premium, whole life policy rather than a limited-payment whole life policy, gives the policy owner the advantage of

• Concentration of premium payments during the period of the highest earnings

• Liberal risk selection procedures

• More insurance protection for the same annual premium outlay

• More rapid accumulation of cash values

Name the provision in a permanent life insurance policy under which premiums are discontinued and full insurance will be maintained for a specified period:

• Extended term insurance

• Paid-up insurance additions

• Life income option person

• Reduced paid-up insurance