LOMA 291 Module 2 Exam Questions
and Answers All Correct
What are the total proceeds payable to the beneficiary?
A. $201,700
B. $202,500
C. $205,700 - Answer-B. - The correct amount is $202,500.$100,000 basic death
benefit+ 300 premium paid in advance+ 5,000 paid-up additional coverage+ 400
declared but unpaid policy dividend+100,000 accidental death benefit$205,700 subtotal-
3,000 outstanding policy loan- 200 policy loan interest$202,500 proceeds payable
When Mickey Evans dies, his life insurance policy proceeds can't go to his named
beneficiary, his wife Carla, because she is also dead. He named their adult son Alex as
the contingent beneficiary, and his adult daughter Abigail as the second contingent
beneficiary. Both children are still alive. In this case, who will receive the proceeds of his
policy?
A. Alex
B. Abigail
C. Alex and Abigail will each receive half of the proceeds - Answer-A. - If no primary
beneficiary is alive at the time of the insured's death, the insurer will pay the benefits to
the contingent beneficiary, or second contingent beneficiary if the contingent beneficiary
is deceased. Since Alex is the contingent beneficiary and he is still alive, the insurer will
pay the proceeds to him.
claim investigation - Answer-The process of obtaining the additional information
necessary to make an appropriate claim decision.
Sources of additional information for a claim investigation can include:
Medical records
Motor vehicle records
Criminal court records
Autopsy Reports
Investigative consumer reports
Any other source that might help
Policy proceeds and interest are paid in a series of equal payments for as long as the
proceeds last.
A. Life Income Option
B. Retained Asset Account (RAA) Option
C, Fixed-Period Option
D. Interest Option
,E. Fixed-Amount Option - Answer-E. - This option is known as the fixed-amount option.
For example, the beneficiary might request to receive monthly payments of $500.
Policy proceeds and interest are paid in a series of payments over the payee's lifetime.
A. Life Income Option
B. Retained Asset Account (RAA) Option
C, Fixed-Period Option
D. Interest Option
E. Fixed-Amount Option. - Answer-A. - This option is known as the life income option.
The insurer would calculate the amount of each payment using actuarial assumptions
about various factors, including how long the average person of the beneficiary's age
and sex is likely to live.
Life income option - Answer-A settlement option under which an insurance company
agrees to pay policy proceeds in periodic installments over the payee's lifetime.
Policy proceeds are deposited into an interest-bearing checking account in the payee's
name.
A. Life Income Option
B. Retained Asset Account (RAA) Option
C, Fixed-Period Option
D. Interest Option
E. Fixed-Amount Option. - Answer-B. - This option is known as the retained asset
account (RAA) option. The payee can withdraw some or all of the proceeds from the
account at any time.
retained asset account (RAA) option - Answer-A settlement option that allows an insurer
to pay a life insurance policy's proceeds into an interest-bearing account in the payee's
name; the payee can then withdraw all or part of the proceeds at any time.
interest option. - Answer-A settlement option under which an insurance company
invests policy proceeds and periodically pays interest on those proceeds.
The insurer invests the policy proceeds and periodically pays interest on these
proceeds to the payee.
A. Life Income Option
B. Retained Asset Account (RAA) Option
C, Fixed-Period Option
D. Interest Option
E. Fixed-Amount Option. - Answer-D. - This option is known as the interest option.
Annuity Death Benefit Process - Answer-Processing annuity death benefit claims is very
similar to processing life insurance death benefit claims but differs in some ways
1. Authenticating and Documenting the Claim
,As with life insurance claims, annuity death benefit claims start with a claimant's
statement and official death certificate.
2. Determining the Amount of the Death Benefit
The death benefit amount is usually the annuity's accumulated value on the day the
insurer receives required documentation.
3. Addressing Applicable Tax Issues
Unlike life insurance death benefits, annuity death benefits typically result in taxable
income to the beneficiary. The insurer reports the total payment, the taxable portion of
the payment, and any taxes withheld to the beneficiary and to tax authorities.
4. Paying the Death Benefit
The insurer pays the annuity death benefit as a lump sum or according to a settlement
option chosen by the contract owner or beneficiary.
Yunel Mendoza was the insured under a $100,000 life insurance policy that included an
accidental death benefit. After Mr. Mendoza died in an accident, a claim analyst
approved the claim and determined the following amounts pertaining to the policy:
$300 in premiums paid in advance
A $3,000 outstanding policy loan
$200 in accrued policy loan interest
$5,000 paid up additional coverage
$400 in declared but unpaid policy dividends
$100,000 accidental death benefits
special investigative unit (SIU) - Answer-A group of individuals who are responsible for
detecting, investigating, and resolving claims, particularly those involving insurance
fraud; often composed of representatives of the claim, legal, and internal audit functions
as well as independent investigators.
Some investigations are quick and simple. Others are extensive. Select all factors that
might make the claim investigation extensive.
Death is unusual given the insured's age
Mysterious death
Death occurred during suicide exclusion period or contestable period
Policy has an exclusion rider
Death is from natural causes
Policy has a relatively high face amount
Death happened abroad - Answer-all but death from natural causes - A claim
investigation might be extensive if the death is mysterious or unusual given the
insured's age; if it occurred during the suicide exclusion or contestable periods; or if it
happened while the insured was traveling in a foreign country. The investigation also
might be extensive if the policy has an exclusion rider or a relatively high face amount.
, When investigating claims, Forthright must - Answer-Follow all privacy laws
Obtain information by only lawful, reasonable, and ethical means
Protect the confidentiality of information
Omnichannel distribution - Answer-A form of distribution that enables personalized
sales to customers through multiple, integrated communication channels.
Common ways to engage with customers - Answer-- Face to Face
- Phone
- Direct Mail or Email
- Online
- Print and Broadcast Media
- Worksite Marketing
- Location Selling
Face to Face - Answer-Financial professionals commonly meet face-to-face with
potential customers, often referred to as prospects. Financial professionals follow a
fairly typical sales process during a series of meetings.
During these face-to-face meetings, the financial professional:
Identifies the prospect's financial needs
Develops a proposal that recommends one or more insurance products to meet the
identified needs
Presents the proposal to the prospect in hopes of completing a sale
If the sale is successful, assists the customer in applying for the product, submits the
application to the insurer, and, in some instances, delivers the policy to the customer
Prospects - Answer-A potential customer for an insurer's products or services.
Phone - Answer-Insurers and financial professionals can use telephones to share
information with customers and prospects. Sometimes, the customer will initiate the
contact...
Direct Mail or Email - Answer-An insurer or financial professional using direct mail or
email distributes insurance sales materials through a mail service directly to a list of
prospective customers. These mailings can be physical letters, brochures, or flyers
mailed to the prospect or emails sent to a distribution list. The target market for direct
mail might be readers of a particular publication or holders of a particular credit card.
For paper mail, the sales materials usually consist of an introduction letter, a brochure
that describes a particular product, an insurance or annuity application, or an inquiry
form the customer can use to request further information about the product. For email,
the insurer provides links to similar items on the insurer's website.
