Life Prep

Match the following

• General, gender, martial, residence, DOB

• APS

• Producer statement on the applicant

• Application Part 2

• Attending Physician Statement

• Agent Report

• Applicants morals, hobbies, habits...

• Application Part 1

• Medical Background, height/weight...

• Inspection Report

Match the following policies

• DB Increases, premiums stay level.

• Decreasing

• Increasing term, refunds premium.

• Level

• Death benefit and prem. remain level

• Return of Prem. Term

• DB Stays level, premiums increase.

• Increasing

• DB decreases, premiums stay level.

• Annually Renewable Term

Organize these options into the right categories

Groups:

(a) Term Insurance

,

(b) Permanent Insurance

• Pure insurance

• Policy loans available

• Coverage may not be convertible

• Temporary protection

• Written for a specified time period or to a specified age

• Premiums may be payable for life, a limited period, or as a lump sum

• Death benefits may be level, decreasing, or increasing

• Policy matures or endows when cash value equals the face amount

• Designed to provide coverage for a lifetime

  
  

• Coverage may be renewable

• Premium builds a reserve known as cash value

  
  

• Issued with a level face amount

Organize these options into the right categories

Groups:

(a) Whole Life

,

(b) Universal Life

,

(c) Variable life

,

(d) Variable Universal Life

• Flexible Premium VUL

• Fixed, guaranteed min. Death benefit

• Policyholder bears risk

• Adjustable, guaranteed min. Death benefit

• Fixed Premium

• Insurer holds risk WL

• Variable, guaranteed min. Death benefit

• Loans and partial surrenders available

• Loans available

• Cash value not guaranteed VUL

• Guaranteed min. Cash value Return Rate

• Variable and Adjustable, no guaranteed min. Death benefit

• Flexible premium

• Guaranteed Cash Value Return Rate

• Cash Value not guaranteed

• Insurer holds risk UL

• Fixed Premium VL

• Loans and partial surrenders available VUL

• Loans Available VL

• Policyholder bears risk VUL

Which of the following products requires a producer to obtain a securities registration in addition to an insurance license to solicit?

• Indexed Life

• Variable Universal

• Universal Life

• Current Assumption Whole Life

All of the following statements regarding sources of underwriting are correct, except:

• A consumer investigative report may include a credit report

• A medical exam may be requested based on the amount of coverage being applied for

• The applicant may be denied coverage based solely on the MIB report

• The agent’s report is confidential between the producer and the insurer

Organize these options into the right categories

Groups:

(a) Universal Life

,

(b) Variable Life

• Death benefit varies along with performance in separate account

• Need FINRA license

• Adjustable Face amount

• Partial withdrawal or surrender available

• Cash value in separate account fluctuates on market conditions

• Guaranteed min. rate of return on Cash Value

• 2 death benefit options

• No guaranteed min on cash value

• Fixed premium

• Mortality charge for cost of pure insurance deducted monthly

• Flexible Premium

• Policy owner holds all investment risk

Increases in insurance protection to keep a Current Assumption policy from endowing is provided:

• With simply part 1 of the application completed

• With limited underwriting

• With full underwriting

• Without evidence of insurability

Answer explanation

It is possible that the cash value will increase too quickly and could cause the policy to mature prior to age 100. To prevent this from happening, the insurer will add a corridor of insurance protection without requiring evidence of insurability to keep the policy from endowing.

How does an Option A death benefit feature of a Universal Life policy work?

• It pays out the policy's cash values

• It pays out the policy's face amount plus the cash values

• It pays out the face amount less the cash values

• It pays out the policy's face amount

Tom submits an application and a premium check. Six days later, the insurer issues the policy as applied for and mails it overnight to Tom's producer. Tom picks up the policy at his producer's office the next day. When did Tom's coverage begin?

• The day Tom picked up his policy at his producer's office

• The day Tom submitted his application

• The day the insurer mailed the policy

• The day the insurer issued the policy