XCEL SOLUTIONS PRACTICE EXAM SIMULATOR|UPDATED&VERIFIED|100% SOLVED|GUARANTEED SUCCESS

Which of the following statements is CORRECT regarding the tax treatment of a lump-sum payment paid to a life insurance policy's primary beneficiary? All proceeds are income tax free in the year they are received. A(n) _____ insurance company is one formed in a country other than the United States. Alien Term insurance has which of the following characteristics? Expires at the end of the policy period. Which Federal law allows an insurer to obtain an inspection report on a potential insured? Fair Credit Reporting Act N is covered by a Term Life policy and does not make the required premium payment which was due August 1. N dies September 15. What action will the insurer take? Claim will be denied. T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive? $0 All of the following are consider to be typical characteristics describing the nature of an insurance contract, EXCEPT: Aleatory K is looking to purchase Renewable Term insurance. Which of these types of Term insurance may be renewable? Level A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached? Waiver of Premium P is the insured on a participating life policy. Which statement is true if P's premiums are waived due to a disability? P will still receive declared dividends. A policy of adhesion can only be modified by whom? The insurance company An individual working part-time has an annual income of 25,000. If this individual has an IRA, what is the maximum deductible IRA contribution allowable? $2,500 How long does the coverage normally remain on a limited-pay life policy? Age 100 A foreign insurance company doing business in Indiana: Is a company that was formed under the laws of another state. All are true statements regarding the underwriting process, EXCEPT: AIDS and HIV virus exams can be conducted in a discriminatory fashion. Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary? Life Income Which of the following types of policies pays a benefit if the insured goes blind? AD&D Rick recently died and left behind an individual IRA account in his name. His widow was forwarded the balance of the IRA. The widow qualifies for the Marital deduction The amount of monthly disability benefits payable under Social Security is affected by which of the following factors? Amount of the benefit available from other sources. An individual covered under a Group Life insurance policy is considered to be a(n): Certificate holder The Consideration cause in a life insurance contract contains what pertinent information? Amount of premium payments and when they are due. An insurance applicant MUST be informed of an investigation regarding his/her reputation and character according to the: Fair Credit Reporting Act