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North Carolina XCEL Testing Life & Health Insurance Exam
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North Carolina XCEL Testing Life & Health Insurance Exam
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North Carolina XCEL Testing Life & Health Insurance Exam1. Which of the following requires insurers to disclose when an applicant's
consumer or credit history is being investigated:: Ans- 1970 - Fair Credit
Reporting Act
2. What type of reinsurance contract involves two companies
automatically sharing their risk exposure?: Ans- Treaty
3. What is the name of the law that requires insurers to disclose information
gathering practices and where the information was obtained?: Ans- Fair
Credit Re- porting Act
4. Who elects the governing body of a mutual insurance company?: Ans-
policyhold- ers
5. The stated amount or percent of liquid assets that an insurer must have
on hand that will satisfy future obligations to its policyholders is called::
Ans- reserves
6. A group-owned insurance company that is formed to assume and
spread the liability risks of its members is known as a:: Ans- risk
retention group
7. What year was the McCarran-Ferguson Act enacted?: Ans- 1945
8. Which of these describe a participating life insurance policy?: Ans-
Policyowners are entitled to receive dividends
9. At what point must a life insurance applicant be informed of their rights
that fall under the Fair Credit Reporting Act?: Ans- Upon completion of the
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,application
10.A nonprofit incorporated society that does not have capital stock and
operates for the sole benefit of its members is known as:: a fraternal
benefit society
11.An insurance applicant MUST be informed of an investigation
regarding his/her reputation and character according to the:: Fair Credit
Reporting Act
12.Which of the following consists of an offer, acceptance, and
considera- tion?: Contract
13.Which of these is NOT a type of agent authority?: Principal
14.E and F are business partners. Each takes out a $500,000 life insurance
policy on the other, naming himself as primary beneficiary. E and F
eventually terminate their business, and four months later E dies. Although E
was married with three children at the time of death, the primary beneficiary
is still F. However, an insurable interest no longer exists. Where will the
proceeds from E's life insurance policy be directed to?: F
15.All of the following are considered to be typical characteristics
describing the nature of an insurance contract, EXCEPT:: Bilateral
16. The part of a life insurance policy guaranteed to be true is called a(n):: -
warranty
17.A life insurance arrangement which circumvents insurable
interest statutes is called:: Investor-Originated Life Insurance
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, 18.Taking receipt of premiums and holding them for the insurance
company is an example of:: Fiduciary responsibility
19.Which of these arrangements allows one to bypass insurable
interest laws?: Investor-Originated Life Insurance
20.Insurance contracts are known as because certain future conditions
or acts must occur before any claims can be paid.: conditional
21.When third-party ownership is involved, applicants who also happen to
be the stated primary beneficiary are required to have:: insurable interest
in the proposed insured
22.Statements made on an insurance application that are believed to be
true to the best of the applicant's knowledge are called:: representations
23.If a contract of adhesion contains complicated language, to whom
would the interpretation be in favor of?: Insured
24.At what point does an informal contract become binding?: When one
party makes an offer and the other party accepts that offer
25.When must insurable interest exist for a life insurance contract to
be valid?: Inception of the contract
26.A life insurance policy would be considered a wagering contract WITH-
OUT:: insurable interest
27.what is a warranty?: is a statement guaranteed to be true
28.Which of these is NOT considered to be an element of an
insurance contract?: negotiating
29.Who makes the legally enforceable promises in a unilateral
insurance policy?: Insurance company
30.In an insurance contract, the insurer is the only party who makes a
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