Life Insurance Modules 1& 2

WHICH of these statements best describes an employee's conversion from a group insurance policy?

• The employee may obtain a conversion policy only if the person was covered under the group policy for at least one year

• The employee will be able to obtain an individual term insurance policy with the same face amount with no proof of health within 31 days of losing the group coverage

• The employee may obtain an individual permanent policy after proving health

• The employee may obtain an individual permanent life insurance policy with no health proof at the insured's attained age and must apply for the policy within 31 days of termination of the group coverage

A policyowner fully surrendered their policy for its cash value. Which of the following statements is true?

• The owner may only reinstate the policy if the state insurance division approves

• The policy may be reinstated if the owner can prove health and repay the surrender values

• The policy is over and cannot be reinstated

• The owner of the contract can replace the insured with another person, reinstate the policy, and begin to see cash value increases

An indexed Universal Life Insurance policy bases its cash value growth on WHICH of the following?

• A static interest rate that remains constant for the life of the policy

• The growth of the separate account funds selected by the policyholder

• A guaranteed interest rate and a current interest rate

• The growth of a specific market index, usually the Standard and Poor's 500 Composite Index

What is provided as proof of coverage in a group contract?

• The sponsor receives a Master Policy and individual policies to distribute to the insured participants

• The sponsor receives the Master Policy and the individual insureds are insured through a list of covered persons held by the insurer

• All parties receive both the Master Policy and certificates of insurance

• The sponsor receives the Master Policy and the individual insureds receive certificates of insurance

All of the following policies have cash value EXCEPT:

• Whole life

• Adjustable life

• Universal life

• A level term policy

Joanna and Harold have convertible term policies and elect to convert. What kind of policy will they have after conversion?

• A tax qualified whole life policy

• Increasing term insurance

• Level term insurance

• Permanent insurance

All of these are living benefits of permanent life insurance EXCEPT:

• Loans

• Surrenders

• Cash values

• Death benefits

If a term policy renews, the premium will increase. This is known as:

• A step rate increase to the premium

• An incremental rate increase

• An original age increase

• A level premium adjustment increase

A business owner entered into an agreement to put off paying salary to a key person, with the promise that the funds would be paid to the employee at a later date. This is a:

• Deferred compensation plan

• A key person policy

• A business buy-sell insurance plan

• A business overhead expense policy

Which of these statements best describes the rate payable to a Variable Universal life insurance policy's cash value?

• The cash value grows based on investments in the separate account selected by the policyowner

• The cash value is fixed and does not change

• The cash value decreases over time

• The cash value is guaranteed by the insurer