Term 1 of 170
An insurer, agent, or broker may accept payment of an insurance premium by credit card if
AThe identity of the credit card holder is verified prior to accepting the transaction.
BThe insured has filed the appropriate credit information with the home office for such
transactions.
CThe insurer is willing to pay the fines levied by the State since credit card use for insurance
premium collection is prohibited by the State.
DThe insurer makes payment by credit card available to all existing and prospective insureds and
pays all fees associated with the transaction.
D
A
Annually renewable term is the purest form of term insurance. The death benefit remains
level, but the premium increases each year with the insured's attained age. In decreasing
policies, while the face amount decreases, the premium remains constant throughout the
life of the contracts. In level term and increasing term policies, the premium also remains
level for the term of the policy. Therefore, in the other types of level policies, the first-year
premium would not be different from any other year.
A
B
,Term 2 of 170
Which of the following will NOT be an appropriate use of a deferred annuity?
ACreating an estate
BAccumulating retirement funds
CAccumulating funds in an IRA
DFunding a child's college education
C
A
D
B
Term 3 of 170
Which type of misrepresentation persuades an insured, to his or her detriment, to cancel, lapse, or
switch policies from one to another?
AFalse advertising
BRebating
CTwisting
DSwitching
C
D
B
A
,Term 4 of 170
Which of the following is NOT true regarding the accumulation period of an annuity?
AIt would not occur in a deferred annuity.
BIt is the period during which the annuity payments earn interest.
CIt is the period over which the annuitant makes payments into an annuity.
DIt is also known as the pay-in period.
D
B
C
A
Term 5 of 170
All of the following statements are true regarding mortgage protection insurance EXCEPT
AThe face amount remains the same throughout the life of the policy.
BIt is used to pay off the balance on the mortgage.
CThe face amount decreases as the amount owed on the mortgage decreases.
DIt's a decreasing term insurance.
B
A
D
C
, Term 6 of 170
Which of the following is NOT true about a group annuity?
AIt can be owned by individual employees.
BIt can be noncontributory.
CIt can be qualified.
DIt can be tax deferred.
D
B
C
A
Term 7 of 170
Both Universal Life and Variable Universal Life have a
ADecreasing premium.
BIncreasing premium.
CFlexible premium.
DLevel fixed premium.
B
C
Limited Pay Whole Life premiums are all paid by the time the insured reaches age 65. The
policy endows when the insured turns 100. It is the premium paying period that is limited,
not the maturity.
C
Variable universal life, like universal life itself, has a flexible premium that can be increased
or decreased as the policyowner chooses, so long as there is enough value in the policy to
fund the death benefit.
D
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