Insurance MCQ

Which of the following Annuities can it be said that it has 'upside potential, but no downside risk' when it comes to the stock market overall? A Indexed B Market Value Adjustment C Variable D Fixed Answer: A

___________ give the owner the rights to the accumulation in the contract. A Annuitization options B Annuity rules C Nonforfeiture provisions D Settlement options Answer: C

A producer needs a securities registration/license in order to sell which of the following annuities? A Variable B Fixed C Indexed D Market Value Adjustment Answer: A

Instead of waiting to receive her payments over time, Jeanne decides to obtain the greatest amount of money out of her annuity immediately. Which option did she choose? A Life Income Period Certain B Life Income with Refund C Lump Sum D Straight Life Option (Life Income) Answer: C

Mr. & Mrs. Smith received monthly benefits from their annuity, and upon Mr. Smith's death, Mrs. Smith receives a reduced amount. What annuity payment option did they choose? A Joint Life B Life Income Joint and Survivor C Life with Cash Refund D Life Income Answer: B

How can an annuity help fund college for a child or grandchild in an tax-efficient and effective manner? A Through systematic withdrawals or proper settlement option selection B Choosing a life only settlement option C Use the interest only option D By cashing out the annuity and using the proceeds to pay off the college bill in one lump sum Answer: A

When does the annuitization period begin? A When the policyowner elects to convert the annuity into an income benefit payment B When the annuitant reaches age 59 1/2 C When the annuitant reaches age 70 1/2 D At the specified age stated in the policy, usually age 100 Answer: A

Which of the following is TRUE regarding Indexed Annuities? A Values and benefits are determined by the performance of a separate account B Values and benefits may increase, but not decrease C The premiums paid are usually invested in separate account(s) D They have a level number of annuity units with a fluctuating unit value Answer: B

A Single Premium Immediate Annuity (SPIA) begins paying out its benefit: A No later than within 60 days, once proper paperwork is completed B At a specified date next year C No later than within 1 month D No later than within 1 year Answer: D

The period of time over which a single sum or periodic deposits grow within an annuity is referred to as the: A Savings Period B Benefit Period C Accumulation Period D Growth Period Answer: C

Which of the following Annuities is generally not backed by the insurer's general account assets? A Market Value Adjustment B Fixed C Indexed D Variable Answer: D

Jasmine has deposited $100,000 into a single premium immediate annuity. If Jasmine were to die before receiving $100,000 in payments, the balance of the $100,000 would be paid to her sister. Jasmine has selected the: A Life Income Period Certain Option B Joint Life Option C Life Income Joint and Survivor Option D Life Income with Refund Option Answer: D

All of the following are factors for a producer to consider when determining annuity suitability for a client, except: A Income B Age C Risk tolerance D Commission Answer: D

Primarily, the _________ is the person who will receive any residual policy benefits after the annuitant has died. A Insurer B Owner C Spouse D Beneficiary Answer: D

Which of the following Annuities would potentially be the most negatively impacted by the overall stock market falling in value? A Variable B Market adjusted annuity C Indexed D Fixed Answer: A

An individual owns a variable annuity. Upon annuitization, the number of Annuity Units on which the benefit amount is based will __________ from month to month. A Remain the same B Vary C Decrease D Increase Answer: A

Z chooses a life income with 10 year period certain settlement option for the annuity Z owns. Z dies after 15 years of receiving income benefit payments. What does Z's beneficiary receive? A Nothing B 10 years' worth of payments C 5 years' worth of payments D Lifetime income Answer: A

What is an annuitant, in regard to an annuity policy? A The issuer of the policy B The party whose life the policy's benefits are based on C The person who has all of the rights in the contract D The party who receives any residual policy benefits Answer: B

Mr. Zamboni is the owner and the annuitant of an annuity. Mrs. Zamboni, the designated beneficiary, will be able to assume all ownership rights and tax-deferral if Mr. Zamboni should die ___________. A During the Distribution Period B After age 55 C During the Accumulation Period D Before age 70 1/2 Answer: C

K owns a variable annuity with an assumed interest rate of 4%. If the actual performance of the separate account(s) is 5%, the effect on this month's income benefit check will be (the) ______: A It all depends on the separate account(s) selected B Same C Higher D Lower Answer: C