B) at the time of application AzAnswer team is here with the right answer to your question. Before using an assumed name in Utah, a producer MUST, Maria would like an annuity that provides a guaranteed accumulation or payout. Which of these features are held exclusively by variable universal life insurance? Which of the following is a reinstatement condition? C) Implied What are conditions in an insurance policy? Preferred risk policies with reduced premiums are issued by insurance companies because the insured has, Better than average mortality or morbidity experience. Which dividend option would an insurer invest the policyowners money and add any interest earnings as the dividends accrue? (A) Both parties to the contract are bound to the terms. Identify the type of financing (stock or bond) that best answers the question. When the term insurance expires. Offering payment of approved claims within 30 days after affirming liability. Bilateral Contract: Definition, How It Works, and Example - Investopedia An example of an unfair claims settlement practice is, Turning down a claim without providing the basis of denial. b) a contract is an agreement enforceable at law. A) Express 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. 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. B) other insurance An insurer exaggerating its dividends in a magazine advertisement. C) Law of large numbers discreet apparent implied express, Bob and Tom start a business. All of the following are examples of a Business Continuation Plan EXCEPT. The policies continue in force with no change. Of the following dividend options, which of these is taxable? The coverage, conditions, and limitations in the master policy of a group contract can be found in which document? Dual Life insurance Joint Life insurance Last Survivor Life insurance Shared Life insurance, Index whole life insurance contains a securities component that acts as a(n) hedge against inflation premium stabilizer means to lowering taxes on earnings incentive to purchase more coverage, Which of the following are the premium payments for a Universal life policy NOT used for? D) Consideration, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Describe the structure. A Modified Endowment Contract (MEC) is best described as, A life insurance contract which accumulated cash values higher than the IRS will allow, Doctors pooling their money to cover malpractice exposures, The free-look provision gives the policyowner, The right to return the policy for a full refund within a specified number of days. His insurance agent told him the policy would be paid up if he reached age 100. 3. warranty Contestability clause, In order for a contract to be valid, it must However, corporations also can raise money by selling bonds or issuing additional shares of stock. Because of this, an insurance contract is considered voidable conditional aleatory unilateral, Who is responsible for assembling the policy forms for insureds? In order to maintain coverage and make a successful claim, its crucial that policyholders read and understand their insurance contract carefully. Updated 10/6/2017 9:10:03 AM. 2003-2023 Chegg Inc. All rights reserved. ______ is NOT an element of a valid contract. The principle of insurable interest, in regards to a life insurance contract, is accurately described in which statement? Countersignature, Which of the following is an example of the insured's consideration? In most insurance policies, the insurer is the only one who makes a legally binding promise to pay insured claims. B) Rescind the policy The terms of the policy typically outline these conditions, which may include paying premiums on time and maintaining the insured property in good condition. Write a summary of the main ideas. representation With a life insurance contract, the insurer binds itself to pay a certain sum upon the death of the insured. What are an applicants statements concerning occupation, hobbies, and personal health history regarded as? B) concealment C) Authority given to handle claims and process payments The type of annuity she is seeking is called. All of these are typically sources of underwriting information for life or health insurance EXCEPT. producer's apparent authority 2003-2023 Chegg Inc. All rights reserved. Within how many days must a licensee notify the Commissioner of a change in address? In order to maintain coverage and make a successful claim, its crucial that policyholders read and understand their insurance contract carefully. Bob dies 12 months later. Zucchini is the best descriptive word. B) A contract that has the potential for the unequal exchange of consideration for both parties. C) Charge more premium Only the insured can change the provisions The terms of the policy typically outline these conditions . During periods of inflation, annuitants will experience a decrease in purchasing power of their payments. Insurance Cram Ch. 6 Flashcards | Chegg.com Which of the following policies does NOT build cash value? 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? Proof of insurabiilty Changes in the insuring clause Premium increase Premium decrease, What is the name of the provision which states that a copy of the application must be attached to the policy when issued? D) Offer and acceptance must be involved, B) Equal consideration is required between the involved parties, A contract requires C) Legal purpose B) the contract must be aleatory insured D) Competent parties, Which of the following BEST describes a conditional insurance contract? Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling? B) Bob's estate Who prosecutes crimes that involve the violation of insurance laws that fall under US Code 1033? The annuitants life expectancy determines the annuity payments, No one may be denied coverage by an insurance company due to, A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n). Food C. Plant D. Zucchini. Which of the following would be a valid reason why a policy premium would be higher than the standard premium? Premiums paid plus interest earned is returned to the beneficiary. voidable consideration A) One party is restored to the same financial position the party was in before the loss occurred B) The unequal exchange of value or consideration for both parties C) One party (the insurance company) prepares the contract with no negotiation between the applicant and insurer D) Only one party (the insurer) makes any kind of enforceable promise the contract is voidable upon proof of fraud. D) legal reserve, In an insurance contract, the element that shows each party is giving something of value is called In order for a contract to be valid, it must. c) a contract must be in writing. Andy the annuitant dies before the annuity start date. The authority granted to a licensed producer is provided via the 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". 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) Parties involved must be competent Expert answered| selymi |Points 23307|. The gap between the total death benefit and the policys cash value. D) misrepresentation, Which of the following is NOT required in the content of a policy? The face amount and premium will remain constant over the 10-year period. Rob recently died at age 60. Please check below to know the answer. A) voidable C) adhesion Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed in Ken? The period of coverage The face amount The premium payments The cash value, at a predetermined date or age, regardless of the insured's health, A Renewable Term Life insurance policy can be renewed at a predetermined date or age, regardless of the insured's health only if the insured provides evidence of insurability anytime at the policyowner's request typically with no change in premium, Pre-death distributions will become taxable, Under a Modified Endowment Contract, what are the likely tax consequences? What is the name of the provision which states that a copy of the application must be attached to the policy when issued? B) Law of adhesion 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 Asked 10/6/2017 7:04:21 AM. 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. An example of an unfair claims practice would be, Failing to effectuate prompt, fair, and fair equitable settlements of a claim. Key elements of Organizational Behavior - People, Structure ,Technology & External Environment | Organizational Behavior, Penology - Meaning, Types, Importance, Scope and Example | Sociology, Karmachari Sanchaya Kosh - | Employees Provident Fund Nepal, Perceptual Errors -Types of Perceptual Error | Fundamentals of Organizational Behaviour, Difference between Manufacturing and Service Operations | Operation Management. The present cash value of the policy equals $250,000. 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. All of the following are considered appropriate uses if life insurance for business purposes EXCEPT, Protecting the business by covering entry level employees with life insurance, Level premium permanent insurance accumulates a reserve that will eventually. Returning a portion of a premium as inducement to purchase insurance, An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out. The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? Authority given to an agent to act outside the scope of 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, When the principal gives the agent authority in writing, it's referred to as a) a conditional acceptance allows the parties to negotiate the definite terms of the contract upon the completion of the contract. C) Contract must have a legal purpose A) Insurer's promise to pay benefits Which of the following statements is true? issuance of the policy C) at the time of death 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 B) Offer and acceptance B) the insurer's obligations are dependent upon certain acts of the insured individual 2. The face amount and policy premium are not affected by the payment Before payment of the benefit is made, specific conditions must exist, such as suffering from a terminal illness There may be a dollar limit on the maximum benefit The benefit can be offered as a rider at a specific extra cost or may be at no cost, Which of the following is NOT part of an insurance contract? 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? After first premium is paid, the face amount may be available to the beneficiary, Level premium term life insurance policies, Have premiums that are averaged over the policy period, A policyowner can receive an immediate payment before the insured dies by using a(n), Matt is applying for life insurance and requests a double indemnity rider. definitions Science Study Guide Questions. A) Competent parties C) the terms must be accepted or rejected in full 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? Bob dies 12 months later. 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) a. medical expenses covered under Pat's employer-sponsored group health insurance. c. income earned by Pat's spouse. A) Express authority C) Materiality of concealment conditional implied D) Only the insured is legally bound, Bob and Tom start a business. 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? To see this page as it is meant to appear, please enable your Javascript! How do marketers use insights regarding the self-concept? What types of life insurance are normally used for key employee indemnification? collateral, What is implied authority defined as? Child term rider Payor rider Family maintenance rider Family income rider, What happens to the coverage under a children's term rider when that child reaches a certain specified age? D) imposed authority, What makes an insurance policy a unilateral contract? A) estoppel What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured? If the other agreement or condition is performed, then the conditional contract is . If she dies 15 years after the policy's inception date, how much will her beneficiary receive? The insured does not meet established underwriting requirements, The type of multiple protection coverage that pays on the death of the last person is called a(n). 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? Which of the following best describe the term definition. C) Only the insurer is legally bound A) Authority given in writing to an agent in the agency agreement Express Apparent Implied Conditional, The type of multiple protection coverage that pays on the death of the last person is called a(n) joint life policy survivorship life policy annuity joint policy dual life policy, A nonforfeiture option can be used to increase the death benefit, All of these are valid options for an Adjustable Life Policy EXCEPT The policy's premium can be increased or decreased The policy's death benefit can be increased or decreased A nonforfeiture option can be used to increase the death benefit The policy's protection period can be modified, A life insurance contract which accumulates cash values higher than the IRS will allow, A Modified Endowment Contract (MEC) is best described as A life insurance contract which accumulates cash values higher than the IRS will allow An annuity contract which was converted from a life insurance contract A modified life contract which enjoys all the tax advantages of whole life insurance A life insurance contract where all withdrawals prior to age 65 are subject to a 10% penalty, An interest-sensitive life insurance policyowner may be able to withdraw the policy's cash value interest free. 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. (D) Only one party is legally bound to the contract. Whole life policy that pays out its cash value over a 20 year period Whole life policy with premiums paid up after 20 years Term life policy that returns cash value after 20 years Term life policy with premiums paid up after 20 years, Which type of multiple protection policy pays on the death of the last person? (C) Both parties exchange goods of equal value. Craig purchased a life insurance policy for enabling his heirs to pay estate taxes. C) Probability of loss C) representation After a number of years, the policy's cash value accumulates to $50,000 and the face amount becomes $350,000. d) an agreement requires a definite offer and an indefinite acceptance. A) there is an element of chance and potential for unequal exchange of value or consideration for both parties 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. 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 B) Implied authority only one party makes any kind of enforceable promise, the terms must be accepted or rejected in full, 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". In exchange, the policyowner pays premiums. term, whole, and universal life insurance increasing term insurance joint, credit, and group life insurance adjustable, permanent, and limited-pay life insurance, 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. 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. Utah requires that an insurance producer must complete ___ hour(s) of continuing education on the subject of law and ethics every reporting period. C) The insured and the insurer contribute equally to the contract. C) Competent parties Georgia Life Insurance Exam Ch. 2 questions & answers for quizzes and __________. 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? A) Parties involved in the contract both parties consent to the contract. $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? A) there is the potential for an unequal exchange of value Chapter3. Legal Concepts of the Insurance Contract fichoh. This is also known as a non-negotiable insurance contract, or an automatic contract. acceptance Provide an opinion. Are you looking for the correct answer to the question Which of the following BEST describes a conditional insurance contract?? C) the authority to represent the insurer Advertisement. Which of the following best describes a conditional insurance contract 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 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. Which Of The Following Statements About Personal Selling Is Correct? Accelerated death benefit An example of an unfair claims practice would be It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. Use the binomial distribution to find P(x13)P(x \leq 13)P(x13) if the stain removal product's claim is correct. the policy provides a straight, level $100,000 of coverage for 5 years. aleatory The two major actions required for a policyowner to comply with the Reinstatement Clause are, Provide evidence of insurability, pay past due premiums, The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as. legal reserve, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Life & Health 1 (Chapters 1, 2, 3, & 4) Flashcards Preview - Brainscape 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 Increasing Term Life policy Nonparticipating policy Modified Whole Life policy Universal Life policy, What is the automatic continuance of insurance coverage referred to as? Elizabeth is the beneficiary of a life insurance policy. A) implied authority Which of the following best defines diction? A. simile B - Weegy What Benefit Does The Payor Clause On A Juvenile Life Policy Provide? D) Personal contract, The importance of a representation is demonstrated in what rule? 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? Intentional withholding of material facts that would affect an insurance policy's validity is called a(n). The provision that allows this is called Partial Surrender Subrogation Automatic Premium Loan Accelerated Death Benefit, All of these are characteristics of a universal life insurance policy EXCEPT Flexible death benefit Fixed surrender value Flexible premiums Builds cash value, Which of the following policies does NOT build cash value? Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed on Ken? A) Insurability Which market index is normally associated with an indexed annuitys rate of return? Principal Capacity, All of the following are elements of an insurance policy EXCEPT offer