In a child insurance policy, the Parent Waiver Clause Provides that

The premiums are waived if the father is disabled or dies.

If an insured is disabled & his life insurance policy is being continued in force thru the Waiver of Premium the dividends of the policy would

Continue as if the owner is paying the premium

If the policy holder changes his occupation without notifying the company, might it affect the benefits under his policy?

No, the benefits agreed upon at the inception of the policy may not be changed.

Insurable interest is necessary when the person insures another.

To establish that there is a genuine risk

In life insurance, the term "substandard rates" generally is used to refer to

Premiums charged to persons who are considered to be higher than average risk categories

Some insurance companies charge females a lower premium rates than males. Which of the following reasons justifies that practice? Women have longer life expectance than men. Generally women buy the higher premium policies. Women are likely to lapse their policy. Generally, women have less hazardous jobs.

Women have longer life expectance than men.

All of the following statements regarding life insurance application are correct except ... Statement made on the application are warrantees usuallu, it will be made part of the policy Misstatement of material facts could void the policy during the contestability period It must be signed by the applicant

Statement made on the application are warrantees

The basic purpose of a conditional premium receipt are to acknowledge payment for life insurance and to

Provide insurance coverage earlier than the policy delivery date if certain requirement are met

Which of the following statements regarding insurance premium is false? Cash is required for all premiums paid in the grace period, A premium is a legal consideration needed to affectuate a life insurance policy, The grace period is usually 31 days, Premiums which are paid quarterly or semi-annually are higher than those paid annually

Cash is required for all premiums paid in the grace period

Under the law pertaining to the life insurance, who can be named irrevocable beneficiaries?

Any person with insurable interest can be named irrevocable beneficiaries.

Paid up additions affect the cash and loan value of the policy?

only affect the cash value of the policy

A client has a policy with you for P1M which is payable to his estate and he tells you that he wants his wife to receive the money free from estate tax. You recommend that he...

appoint an irrevocable beneficiary

The settlement options provision may provide all of the following except: Payments of the proceeds in fixed amounts until exhausted , Payment for the proceeds over a fixed period, Payment of the proceeds for the life of the insured

Proceeds held by the company with interest payable to the benefiaciary on request

The extent of the medical evidence required is determined by

the age of the applicant and the proposed sum to be insured

The insured named a primary and secondary revocable beneficiary for P200k policy. Which of the following is correct? the insured can add a 3rd beneficiary anytime, the designation of a contingent beneficiary is subject to the primary beneficiary's approval, Upon the insured's death the primary and secondary beneficiaries shall receive P100K each, a policy loan assignment will require the primary beneficiary's signature

the insured can add a 3rd beneficiary anytime

Brandon advised his friend to get a policy that accumulated cash value because it is beneficial in the long run. Which of the following is false about cash value? Because of its very short duration, the cash value of a yearly renewable term policy grows very fast. The cash value of the whole life policy builds up at a slower rate than a 20-year endowment. The cash value of a permanent policy is guaranteed by the company. The cash value of an endowment builds up faster than a limited pay life policy.

Because of its very short duration, the cash value of a yearly renewable term policy grows very fast.

The guarantee cash value is

the amount that the company will pay if the policy is surrendered

Insurance provides protection against economic loss by enabling the policy owner to

share loss with others exposed to a similar risk

How Endowment life insurance & term life insurance the same?

Provide life insurance protection for only the period of time specified in the policy contract

Under the Endowment Policy, if a person whose life is insured survives to the end of the period stated in the policy

Face amount of the policy will be paid

A whole life policy provides

Protection with premiums payable for life and a low savings as an alternative to continued protection in old age

A Term Policy provides

Low-cost protection for only a limited term of years with no savings

Applicants for life insurance with moderate physical impairments are called sub-standard risks and

May be insured at increased rates to compensate for the extra hazard

An agent fills out the Agent's Confidential Report. What information must he put in his report?

All information he knows which are material to the application for insurance.

A risk is considered sub-standard based on any or all of the following criteria: Income, Educational Attainment, and Occupation; Occupation, Moral character, and family health history; Death, income and educational background; Death, occupation and moral character.

Occupation, Moral character, and family health history

An insurance company generally has the right to recind a life insurance policy if: Company discovers at any time the policy owner was actually a minor at the time of application, Company discovers during the contestable period that the application contains a material statement, Insured person is killed in military action during the contestable period of the policy, Insured person intentionally kills himself during the suicide exclusion period specified in the policy.

Company discovers at any time the policy owner was actually a minor at the time of application

The insurance code specifies that a contract does not take effect unless: Payment of the first premium is made to the insurer or its authorized agent, The policy is delivered to an insured, his assignee, agent, or beneficiary, No change has taken place in the insurability of the life to be insured between the time the application was completed and the time the policy was delivered, The insured has named in the policy no fewer than 2 beneficiaries

Payment of the first premium is made to the insurer or its authorized agent

If the interest on a policy loan is not paid at the policy anniversary, the insurance company may: Refuse to grant future additional loan, Increase the present loan by the interest, Terminate the contract, Demand full statement of the loan

Increase the present loan by the interest

If the person whose life is insured dies during the grace period and the premium was not paid, what amount will the insurance company pay to the beneficiary?

Face amount of the policy minus the unpaid premium.

The company will allow a policy change from a higher premium to a lower premium plan provided the insured presents satisfactory evidence of insurability.

Presents satisfactory evidence of insurability

A man applied for a P200K Whole life policy and paid the full initial premium of the soliciting agent. The agent issued a binding receipt. Under such a receipt, the insurance company

Immediately provides interim insurance that remains in effect until the policy is issued or the application is declined.

When you bought an insurance policy on your wife's life, you were 27 and she was 26, but you stated that you were 26 and she was 27. Five years later your wife died. The insurer will pay

The face amount adjusted for the misstatement of age.

The incontestability clause

Prevents the company from denying a claim after the policy has been in force for 2 years

JatradG7 Flashcards

Student preview

60 questions

Show all answers

1.

FLASHCARD QUESTION

Front

Life insurance companies makes use of the Laws of Probability in order to

Back

Estimate Future Death rates among members of a given group

2.

FLASHCARD QUESTION

Front

If Rosa wants to continue her renewable term insurance, she may

Back

Renew the cover based on the higher premium

3.

FLASHCARD QUESTION

Front

Limited Payment life policies are policies that

Back

Limit the period during which premiums are payable

4.

FLASHCARD QUESTION

Front

Imelda is considering purchasing either endowment or term life policy. What do these policies have in common?

Back

Insurance protection will be limited in a specific period.

5.

FLASHCARD QUESTION

Front

A Yearly Renewable term life insurance policy generally specifies

Back

Premiums shall increase everytime the policy is renewed

6.

FLASHCARD QUESTION

Front

A person wanting a greater coverage for the least amount of premium has an option of attaching what rider in his permanent life policy?

Back

Term Insurance Rider

7.

FLASHCARD QUESTION

Front

The total life coverage of a permanent basic life policy can be greatly increased thru the use of a supplemental term rider

Back

a supplemental term rider

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