Which of the following Best Describes a Conditional Insurance Contract D) A contract where only one party makes any kind of enforceable contract, A) A contract that requires certain conditions or acts by the insured individual, All of the following are elements of an insurance policy EXCEPT 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? A) insured An example of an unfair claims practice would be, Failing to effectuate prompt, fair, and fair equitable settlements of a claim. If thats the case, you dont have to worry anymore. 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? Chapter 3: Legal Concepts Flashcards | Quizlet Sharon is the policyowner of a $500,000 life insurance policy. Group policy Adjustable life policy Whole life policy Endowment policy, A renewable Term Life insurance policy allows the policyowner the right to renew the policy at anytime the policyowner chooses as many times as the policyowner chooses paying the same premium as before the renewal without producing proof of insurability, When a decreasing term policy is purchased, it contains a decreasing death benefit and increasing premiums level premiums decreasing premiums variable premiums, Julie has a $100,000 30-year mortgage on her new home. When initial premium is collected and policy is issued. B) written contract Chapter 1 - Completing the application, underwriting, and - Chegg Utah requires that an insurance producer must complete ___ hour(s) of continuing education on the subject of law and ethics every reporting period. It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill. James is the insured on a life insurance policy where his age was misstated on the application. A. express authority A) State Insurance Departments Business owner and business client, The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? Orissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. (A) Both parties to the contract are bound to the terms. insurer A) offer and acceptance Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. When the term insurance expires. D) purpose, Which principle is accurately described with the statement "Insureds are entitled to recover an amount NOT greater than the amount of their loss"? What is this an example of? Notify me of follow-up comments by email. Which type of multiple protection policy pays on the death of the last person? D) Only the insured is legally bound, Bob and Tom start a business. B) only an offer definitions An applicants character and personal habits can be obtained for underwriting purposes from which source? A) fiduciary bond Completing all applications and collecting initial premiums. the contract is voidable upon proof of fraud. Policy Summary Buyer's Guide Entire Contract Entire Policy, It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill, What is the purpose for having an accelerated death benefit on a life insurance policy? An unintentional violation of Utah insurance law could lead a producer to a fine of up to _____ per violation. a. medical expenses covered under Pat's employer-sponsored group health insurance. An insurer's claim settlement practices are regulated by the Securities and Exchange Commission (SEC) National Association of Claims Adjusters (NACA) National Association of Insurance Commissioners (NAIC) State insurance departments, A life insurance company has transferred some of its risk to another insurer. D) Consideration, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Dependent term Guaranteed insurability Primary term Family term, Which type of life insurance offers flexible premiums, a flexible death benefit, and the choice of how the cash value will be invested? B) 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 Nothing $100,000 $250,000 $500,000, Which type of life insurance is normally associated with a Payor Benefit rider? C) consideration Which of the following statements is true? Intentional withholding of material facts that would affect an insurance policy's validity is called a(n). After a number of years, the policy's cash value accumulates to $50,000 and the face amount becomes $350,000. A double indemnity benefit will be payable to Matts beneficiary is Matt, All of the following riders can increase the death benefit amount EXCEPT, All of these are valid policy dividend options for a life insurance policyowner EXCEPT, The premium for a Modified whole life policy is, Lower than the typical whole life policy during the first few years and then higher than typical for the remainder, A nonparticipating company is sometimes called a(n), Intentional withholding of material facts that would affect an insurance policys validity is called a(n), Signatures for an insurance application MUST be obtained by the producer from all of the following sources EXCEPT. For a trip to the hospital, Evan Appleton paid $1,656 in hospital charges, a$750 insurance deductible, and a $457 co-payment. A person who is a nonsmoker, of average weight, and in excellent health would most likely be in which risk classification? How do insurers predict the increase of individual risks? D) collateral, Express power given to an agent in an agency agreement is Which dividend option would an insurer invest the policyowners money and add any interest earnings as the dividends accrue? Who prosecutes crimes that involve the violation of insurance laws that fall under US Code 1033? A) Express C) Insurance carriers $2,406 The policy may be paid up early by using accumulated cash values The policy may be paid up early by using policy dividends The policy's premiums will increase after 20 years The policy's cash values steadily decrease after 20 years, the policy would be payable, minus the premium amount, If an insured dies during the grace period with no premiums paid the policy would be payable, minus the premium amount the policy would be payable only after the beneficiary makes past due premium payment all past premiums will be refunded with interest the claim would be denied, In what part of an insurance policy are policy benefits found? In most cases, the insured is. What kind of policy is this? D) A contract where only one party makes any kind of enforceable contract, Answer:A) A contract that requires certain conditions or acts by the insured individual. C) at the time of death Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. B) premium only Vegetable B. Both partners are still married at the time of Bob's death. Waiver Exclusion Rider Provision, The double indemnity provision in a life insurance policy pertains to an insured's death caused by a(n) sickness suicide accident war, An insurer will accept a premium from the insured and continue the coverage in full force as though it was NOT late during which time period? 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? B) concealment B) acceptance Legal purpose Typically, bilateral contracts involve an equal obligation or. Which Of The Following Best Describes A Conditional Insurance Contract, A) A contract that requires certain conditions or acts by the insured individual, B) A contract that has the potential for the unequal exchange of consideration for both parties, C) A contract where one party adheres to the terms of the contract, D) A contract where only one party makes any kind of enforceable contract. express, ______ is NOT an element of a valid contract. A) Unilateral All of the following statements about Carl's coverage are correct. b. benefits paid under workers compensation. Required fields are marked *. A policyowner can receive a percentage payment of the death benefits prior to death by using what kind of contract? D) the contract must be a contract of adhesion, C) there must be legal reasons for entering into the contract, Ambiguities in an insurance policy are always resolved in favor of the The policies continue in force with no change. renewal reinstatement resumption renovation, the MEC tends to be an investment vehicle, Pre-death distributions from a modified endowment contract (MEC) receive different tax treatment than other life insurance policies because the MEC has tax deductible premiums the MEC is considered an illegal product the MEC tends to be an investment vehicle the MEC does not accumulate cash value, The face amount and premium will remain constant over the 10-year period, Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. 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? Only the insured pays the premium B) Rescind the policy Which of the following would be a valid reason why a policy premium would be higher than the standard premium? D) both the policyowner and the insurer must know all material facts and relevant information, B) only one party (the insurer) makes any kind of legally enforceable promise, Intentional withholding of material facts that would affect an insurance policy's validity is called a(n) C) aleatory C) there must be legal reasons for entering into the contract Which of the following describes a person who is NOT acceptable by an insurer at standard rates because of health history, occupation, or hobbies? Which of the following best describes the MIB? c. income earned by Pat's spouse. With a life insurance contract, the insurer binds itself to pay a certain sum upon the death of the insured. Which of the following is an annuity that is linked to a market-related index? Which of the following BEST describes a conditional insurance contract. Sister and brother Parent and children Business partners Business owner and business client, The deeds and actions of a producer indicate what kind of authority? A paid premium Where would policy proceeds be paid if both the insured and primary beneficiary were killed in the same accident? A rating from a rating service company, such as A.M. Best An illustration A sales presentation Direct mailing from an agency, Fraternal Benefit Society has each of the following characteristics EXCEPT Incorporated Without capital stock Exist For profit Exist for the benefit of its members, A plan in which an employer pays insurance benefits from a fund derived from the employer's current revenues is called A self-derived plan A multiple-employer plan A blanket plan A self-funded plan, An insurer's ability to make unpredictable payouts to policyowners is called investment values liquidity assets capital, Ken is a producer who has obtained Consumer Information Reports under false pretenses. An individual who has a hobby racing cars once a month. A) there is an element of chance and potential for unequal exchange of value or consideration for both parties 2. B) A contract that has the potential for the unequal exchange of consideration for both parties The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? C) claim forms Flashcards - Ch. 15 - Disability Income - FreezingBlue What does the Group Life underwriting risk selection process help protect insurance companies from? Which of these factors is NOT taken into account when determining an applicants life insurance needs? C) insurer Multiple-choice. A policy containing exclusions or limits that are not clearly disclosed to the policyholder, or a premium that is significantly higher than the risk covered, could be considered unfair or one-sided. The gap between the total death benefit and the policys cash value. Aleatory Contract: A contract type in which the parties involved do not have to perform a particular action until a specific event occurs. Answer Explanation: A contract that requires certain conditions or acts by the insured individual. During periods of inflation, annuitants will experience a decrease in purchasing power of their payments. B) other insurance there is the potential for an unequal exchange of value Barry offers Chris his mountain cabin for the weekend to secure his order for his insurance business. Question and answer. What is the difference between insurance condition and warranty? State Insurance Departments NAIC Insurance carriers Insurance producers, Intentional withholding of material facts that would affect an insurance policy's validity is called a(n) estoppel concealment adhesion misrepresentation, The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? Bob and Tom start a business. What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured? a) a conditional acceptance allows the parties to negotiate the definite terms of the contract upon the completion of the contract. The insurer assuming the risk is called the mutual insurer reinsurer reciprocal insurer participating insurer, Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. Insurance Exam Flashcards | Chegg.com the contract must be aleatory Reduction of premium One year term Paid-up additions Accumulation at interest, All of these are valid policy dividend options for a life insurance policyowner EXCEPT cash outlay to the policyowner accumulate without interest reduction in policy premium buy additional insurance coverage, Kurt is an active duty serviceman who was recently killed in an accident while home on leave. Adjustable life Credit life Modified life Universal life, Whole life policy with premiums paid up after 20 years, Which of these would be the best example of a limited pay life insurance policy? If the insured dies at any time during the 5 years, his beneficiary will receive the policy's face value. D) Business owner and business client, Under a contract of adhesion, A contract that requires certain conditions or acts by the insured individual. Which type of life insurance offers flexible premiums, a flexible death benefit, and the choice of how the cash value will be invested? Offering payment of approved claims within 30 days after affirming liability. B) Law of adhesion D) the authority to add provisions to a contract, C) the authority to represent the insurer, Which of the following contracts is defined as "one that restores an injured party to the condition that was present before the loss"? In the case of an insurance contract, the contracting parties are the claimant and the insurer. 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? The policy automatically converts to whole life after the 10-year period The face amount will remain constant and the premium will increase over the 10-year period The premium will remain constant and the face amount will increase over the 10-year period The face amount and premium will remain constant over the 10-year period, will no longer provide insurance protection, Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life policy covering all three of their lives. C) Legal purpose An insurance contract usually involves an exchange of consideration between both parties: the insurer agrees to provide coverage and pay claims in the event of a loss, and the policyholder agrees to pay premiums in return. In this situation, who will receive Bob's policy proceeds? imposed authority, In an insurance contract, the element that shows each party is giving something of value is called D) conditions, The authority granted to a licensed producer is provided via the C) Apparent authority An individual who removes the risk of losing money in the stock market by never purchasing stocks is said to be engaging in. Which of the following best describe the term definition Policy loans are disallowed The premium payments will be tax deductible Pre-death distributions are typically taxable Withdrawals will be prohibited, When a whole life policy is surrendered, income taxes may be owed, All of these statements concerning whole life insurance are false EXCEPT Policyowner can take out a policy loan up to the face amount When a whole life policy is surrendered, income taxes may be owed Coverage is normally temporary The death benefit is not affected by outstanding loans, A life insurance policy which contains cash values that vary according to its investment performance of stocks is called Increasing Term Life Modified Whole Life Variable Whole Life Adjustable Whole Life, Which of these riders will pay a death benefit if the insured's spouse dies? All of these are typically sources of underwriting information for life or health insurance EXCEPT. Definition refers to a description which is given to a word, idea or phenomenon . Which of these would NOT be an unfair claims practice? A new stain removal product claims to completely remove the stains on 909090 percent of all stained garments. LIFE INSURANCE LICENSING EXAM Flashcards | Chegg.com Apparent Legal Consideration Competent parties Countersignature, A contract that requires certain conditions or acts by the insured individual, Which of the following BEST describes a conditional insurance contract? A) One party is restored to the same financial position the party was in before the loss occurred. 0 Answers/Comments. A contract that requires certain conditions or acts by the insured individual This means that the insurer's promise to pay benefits depends on the occurrence of an event covered by the contract. B) the unwritten authority that the agent is assumed to have One-sided or unfair insurance contracts can, however, exist if they contain provisions that disproportionately benefit one party. C) negotiation between the involved parties Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed in Ken? C) statements made in the application and the premium D. $2,863. (B) Both parties adhere to the contract. A contract that requires certain conditions or acts by the insured individual Which of these is considered to be a Living Benefit option in a life insurance policy? All of the following are examples of pure risk EXCEPT. 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?
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