REAL Primerica Life Insurance Exam: Questions & Answers100% verified 2023
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Course
LIFE INSURANCE
Institution
LIFE INSURANCE
An insured purchased an insurance policy 5 years ago. Last year, she
received a dividend check from the insurance company that was not
taxable. This year, she did not receive a check from the insurer. From what
type of insurer did the insured purchase the policy?
a. mutual
b. reciprocal
c. no...
Primerica Life Insurance Exam: Questions &
Answers
An insured purchased an insurance policy 5 years ago. Last year, she
received a dividend check from the insurance company that was not
taxable. This year, she did not receive a check from the insurer. From what
type of insurer did the insured purchase the policy?
a. mutual
b. reciprocal
c. nonprofit service organization
d. stock
(Ans- A. mutual
funds not paid out after paying claims and other operating costs are
returned to the policy owners in the form of a dividend. if all funds are paid
out, no dividends are paid
Following a career change, an insured is no longer required to perform
many physical activities, so he has implemented a program where he walks
and jogs for 45 minutes each morning. The insured has also eliminated
most fatty foods from his diet. Which method of dealing with risk does this
scenario describe?
a. retention
b. reduction
c. transfer
d. avoidance
(Ans- B. reduction
the insured's change in lifestyle and habits would likely reduce the chances
of health problems
,In insurance, an offer is usually made when
a. an applicant submits an application to the insurer
b. the insurer approves the application and receives the initial premium
c. the agent hands the policy to the policyholder
d. an agent explains a policy to a potential applicant
(Ans- A. an applicant submits an application to the insurer
in insurance, the offer is usually made by the applicant in the form of an
application. acceptance takes place when an insurer's underwriter
approves the application and issues a policy
the causes of loss insured against in an insurance policy are known as
a. perils
b. losses
c. risks
d. hazards
(Ans- A. perils
perils are the causes of loss insured against in an insurance policy
what documentation grants express authority to an agent?
a. agents contract with the principal
b. agents insurance license
c. fiduciary contract
d. state provisions
(Ans- A. agents contract with the principal
the principal grants authority to an agent through the agent's contract
,which of the following best describes an insurance company that has been
formed under the laws of this state?
a. domestic
b. sovereign
c. alien
d. foreign
(Ans- A. domestic
a company is domestic when doing business within the state in which it is
incorporated
which of the following factors is NOT considered by an underwriter when
determining the premium rates for an individual seeking insurance?
a. medical history
b. sex
c. age
d. race
(Ans- D. race
age, medical history, and sex provide sound statistical date for determining
the probability of loss. Race, religion, sexual orientation, etc. are the factors
that cannot be used because there is not sound statistical data to show that
they effect the probability of loss; therefore, they are considered to be
discriminatory
in insurance transactions, fiduciary responsibility means
a. handling insurer funds in a trust capacity
b. maintaining good credit record
c. being liable with respect to payment of claims
d. commingling premiums with agents personal funds
(Ans- A. handling insurer funds in a trust capacity
, an agents fiduciary responsibility includes handling insurer funds in a trust
capacity
the authority granted to an agent through the agent's contract is referred to
as
a. absolute authority
b. express authority
c. apparent authority
d. implied authority
(Ans- B. express authority
express powers are written into the contract between the insurer and the
agent
insurance policies are not drawn up though negotiations, and an insured
has little to say about its provisions. what contract characteristic does this
describe?
a. unilateral
b. conditional
c. personal
d. adhesion
(Ans- D. adhesion
a contract of adhesion is prepared by only the insurer; the insured's only
option is to accept or reject the policy as its written
which of the following insurers are owned by stockholders who have the
usual rights of ownership, including the right of voting?
a. reciprocal
b. fraternal
c. stock
d. mutual (Ans- C. stock
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