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AZ Life Insurance Exam Prep Study Guide
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AZ Life Insurance Exam PrepStudy Guide
-Secondary - -A Contingent Beneficiary has the __________ right to collect an
Insured's death benefit.
--A uniform set of insurance regulations - -What does the Producer Licensing
Model Act (PLMA) provide?
-A uniform set of insurance regulations
-Disability income
-A double payout
-Private Life Maturity Assets
--They are known for their very flexible payment terms - -All but which of
the following are true about Whole life insurance policies?
-They are a traditional type of life insurance policy
-They are more restrictive than adjustable policies
-They are known for their very flexible payment terms
-Each premium payment is the same
-It is not easy to change the face amount
--Contract - -A life insurance Policy is a(n) __________________ that requires
the Insurer to pay the Death Benefit of the policy to the policy Beneficiary
when the insured dies.
-Annuity
-Underwriting
-Promise
-Contract
--Life Income - -Rachel is the Beneficiary of a life insurance policy. The
insured has passed away. She reviews the various payout settlement
options. Rachel chooses the option that operates like an annuity. What
option did she choose for the payout?
-Periodic annuitized payout
-Fixed period installments
-Fixed amount installments
-Life Income
, --Third-party policy - -Aaron wants to buy an insurance policy and serve as
the Beneficiary in the event that his daughter Cheryl passes away. What type
of policy will Aaron purchase?
-First-party policy
-Third-party policy
-Second-party policy
-Indirect policy
-None of the above
--Greater than - -The premium for a Whole life policy is usually
________________ the premium of a Term life policy:
-Less than
-The same as
-Greater than
-Half the cost of
-One-third of
--The payout is distributed and fixed and equal installment payments over a
specified time period - -With a Fixed Installment Settlement option:
-The payout is distributed through fixed level installment payments over a
specified time period
-It is like an annuity
-The proceeds are paid out monthly from the face amount and interest
-The interest is paid out and the face amount is paid out later
--Vesting - -What is the term that relates to the amount of money that an
Insured is entitled to withdraw from an annuity?
-Vesting
-Build up
-Defined benefit
-Single Premium Deferred Annuity (SPDA)
--False - -Edmond suffered from a kidney condition that is controlled with
medical treatment. He wants to purchase a life insurance policy. His pre-
existing condition prevents him from getting a policy.
-True
-False
--There is usually a smooth transfer of a business to the beneficiary upon
the death of the business owner. - -All but which of the following are true
about having Sole Proprietorship within a life insurance policy?
,-There is usually a smooth transfer of a business to the beneficiary upon the
death of the business owner.
-A sole proprietor has special needs and risks with respect to life coverage.
-There are considerable costs when transitioning from a dead business owner
to their beneficiary.
-When a sole proprietor dies, so does their business.
--Equity-Indexed Universal - -What type of Universal life policy offers a
Policyholder the ability to increase the Cash Value of the policy based on
changes in the stock index?
-Equity-Indexed Universal
-Equity Interest
-Current assumption
-Excess Interest
--Premiums are deductible when the policy benefits are paid out - -Which of
the following is incorrect about the taxation of an individual's life insurance
Policy?
-Beneficiaries typically do not pay taxes on the Death Benefit
-Premiums are deductible when the policy benefits are paid out
-Premiums are generally not tax-deductible in the year paid
-None of the above
--a Waiver of Premium Rider - -Jerry wants to purchase a life insurance
policy, but is worried that his failing hip will render him disabled and unable
to pay the policy Premiums. What option could you suggest to Jerry?
-Disability Forgiveness
-a Qualified policy
-a Non-Qualified policy
-Do not purchase life insurance
-a Waiver of Premium Rider
--Sell life policies - -Which of the following functions does an Underwriter
NOT perform?
-the Evaluation of Risk
-the Review of Medical Histories
-the Selling of life Policies
-the Determination of the Premium Payment amount(s)
--Assets are not accessible by a judgment creditor - -Saheed owns a
valuable business, but often gets sued because his products sometimes
, cause personal injury. Which advantage of a Tax-Qualified policy will provide
an advantage to Saheed?
-Assets are not accessible by a judgment creditor
-Ratings applied to the policy are tax-deductible
-Qualified plans prevent breaches in coverage
-Premiums and contributions are tax deductible
--Group life policies - -The federal Anti-Money Laundering laws do not apply
to _______________.
-Whole life policies
-Group life policies
-Annuities
-An insurance product containing an investment element
-None of the above
--I, II and III - -Lorenzo visits your insurance office to reach life insurance
policies for the people employed by his software company. Which of the
following should be considered when providing him with advice?
I. The business itself
II. The risks involved
III. The employees
IV. The customers
V. The location of the business
-I, II and V
-II and III
-I, II and III
-I, II, III, IV and V
-II only
--After the sale - -Providing extensive customer service to a client is usually
most important:
-Prior to the sale
-After the sale
-At the moment of the sale
-None of the above
--United States vs. Southeastern Underwriters Association - -_______________
determined that the sale of an insurance product from an entity in one state
to an entity in a different state constitutes as Interstate Commerce.
-Paul vs. Virginia
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