Insurance MCQ

When an employee terminates coverage under a group insurance policy, coverage continues in force A) For 60 days. B) Until the employee can obtain coverage under a new group plan. C) Until the employee notifies the group insurance provider that coverage conversion policy is issued. D) For 31 days Answer: For 31 days

Which of the following would be the beneficiary in credit life insurance A) Insured B) Company C) Borrower D) Creditor Answer: Creditor

Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured A) Corridor option B) Variable option C) Option A D) Option B Answer: Option B

Which of the following is TRUE about credit life insurance A) Debtor is the policy beneficiary. B) Creditor is the policyowner. C) Debtor is the annuitant. D) Creditor is the insured Answer: Creditor is the policyowner

Which of the following types of policies allows the policyowner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount A) Variable life B) Adjustable life C) Universal life D) Flexible life Answer: Universal life

Which statement is NOT true regarding a Straight Life policy A) It has the lowest annual premium of the three types of Whole Life policies. B) Its premium steadily decreases over time, in response to its growing cash value. C) The face value of the policy is paid to the insured at age 100. D) It usually develops cash value by the end of the third policy year Answer: Its premium steadily decreases over time, in response to its growing cash value

A married couple owns a permanent policy which covers both of their lives and pays the death benefit only upon the death of the first insured. Which policy is that A) Joint Life Policy B) Survivorship Life Policy C) Second-to-Die D) Family Income Policy Answer: Joint Life Policy

An insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured's age 100 is called A) Single premium whole life. B) Modified Endowment Contract (MEC). C) Level term life. D) Graded premium whole life Answer: Single premium whole life

All of the following could own group life insurance EXCEPT A) A group needing low-cost life insurance. B) A group sponsored by an employer. C) An alumni group. D) A debtor group Answer: A group needing low-cost life insurance

Concerning Juvenile Life insurance, which of the following statements is INCORRECT A) Usually a parent or guardian is the applicant for insurance on the life of a minor. B) It can be a limited premium payment policy. C) Juvenile Life is classified as any life insurance written on the life of a minor. D) Juvenile Life is classified as any life insurance purchased by a minor Answer: Juvenile Life is classified as any life insurance purchased by a minor

All of the following entities regulate variable life policies EXCEPT A) The Guaranty Association. B) Federal government. C) The SEC. D) The Insurance Department Answer: The Guaranty Association

An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation A) Variable life B) Universal life C) Whole life D) Decreasing term Answer: Decreasing term

In a survivorship life policy, when does the insurer pay the death benefit A) If the insured survives to age 100 B) Upon the last death C) Upon the first death D) Half at the first death, and half at the second death Answer: Upon the last death

Which of the following is called a "second-to-die" policy A) Family income B) Juvenile life C) Joint life D) Survivorship life Answer: Survivorship life

In an Adjustable Life policy all of the following can be changed by the policy owner EXCEPT A) The length of coverage. B) The premium. C) The amount of insurance. D) The type of investment Answer: The type of investment

An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it A) Variable Life B) Adjustable Life C) Graded Premium Life D) Limited-pay Life Answer: Limited-pay Life

To sell variable life insurance policies, an agent must receive all of the following EXCEPT A) A securities license. B) A life insurance license. C) A SEC registration. D) A FINRA registration Answer: A SEC registration

Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die A) Ordinary Life B) Joint Life C) Decreasing Term D) Whole Life Answer: Joint Life

An Adjustable Life policyowner can change which of the following policy features A) The insured B) The coverage period C) The mortality expense D) The investment account Answer: The coverage period

In a group life insurance policy, the employer may select all of the following EXCEPT A) The amount of insurance. B) The premium payor. C) The beneficiary. D) The type of insurance Answer: The beneficiary