Fundamentals of Life Insurance FINAL EXAM (MASTER) Copy

What is the earliest culture life insurance can be traced back to?

The human life value concept recognizes which of these as a type of loss?

Insurance premiums must always be adequate, reasonable and _________.

Persistency is:

Participating policies allow their policy owners the ability to ____ in the increased profits of an insurer.

Which of these is NOT a standard provision in a life insurance contract?

The first true mutual insurance company for life insurance was called:

Insurance relies on what to reduce the speculative element of insurance and to compensate for fluctuations in losses?

The gross premium is:

Mortality tables:

An insurance policy is what kind of contract?

“Valued contract” means _______________

In terms of a contract, “adhesion” means _____________.

The insurer’s obligation to pay claims are conditioned upon certain acts, such as:

To be legally capable of making a contract, a person may not be __________.

Mutual agreement is ____________.

The effective date of a policy is generally ______________.

Insurable interest _______________.

The application is the ______________.

Concealment is ___________.

A representation is a statement given to an insurance company concerning __________.

What is the length of time a person must be gone to be presumed dead?

In the suicide clause, what is the length of time from the application date that the insurer will not pay if the insured commits suicide?

What are two of the most common exclusions used by underwriters?

Status clause and results clause are types of what exclusion?

The beneficiary of an insurance policy is _____________.

The most common payout of death benefits is by __________.

The two types of assignments are:

A viatical settlement is a _____________.

The ______ allows the policy owner to reinstate a policy that had lapsed, under certain requirements.

The _________ rider allows the policy to continue without further premium payments if the insured becomes disabled and cannot work.

In the accidental death rider, death must occur _____ days after the accident.

The simplest and most basic form of life insurance is:

Whole life insurance is defined as any type of life insurance that can be maintained ________________.

The enhanced life policy is a participating whole life policy that uses ____ to reduce the premiums of the policy.

What is the principal purpose for juvenile insurance?

Burial insurance is used for:

Generally, what employees are eligible for group coverage?

When does group life insurance end for an employee?

What is the principal difference between CAWL and UL policies?

Variable universal life is a policy that has the premium flexibility and policy adjustment features of _____ with the investment options of variable life.

Which IRS provision allows an exchange pf a policy for a new one insuring the same person without paying tax on investment gains earned under the original contract?

What is one of the most attractive feature of a variable universal life policy

In order for a ____ to meet the definition of an insurance contract and obtain favorable tax treatment, it must meet a cash value accumulation test, a corridor test, and the 7-pay test.

Financial objectives are either cash objectives or ________.

Which of these categories is NOT a business use of life insurance?

_______ is an unincorporated business owned by a single person; typically the owner also manages the business.

________ is a voluntary association of two or more individuals for the purpose of conducting a business for profit as co-owners

An individual who possesses a unique ability essential to the continued success of a business is called:

Why is life insurance taken out on a key employee of a business?

Individuals who market life insurance are called:

The process of underwriting consists of these two separate functions:

________ starts when an applicant who is uninsurable or a greater than average risk seeks to obtain a policy from a company at a standard premium rate.

The __________ a person, the __________ mortality risk.

Females have a __________ mortality rates than males.

What is the most important factor in underwriting?

Build includes height, weight and __________.

Tobacco use:

Which of the following is not a source of information for underwriters?

Part one of the application includes what information?

The MIB is ___________________.

The numerical rating system starts with the standard rating of __________.

__________ reflect the extra mortality expected for individuals with the same ratings.

When is the flat extra premium used?

Anything above a table __________ is, in most situations, uninsurable.

__________ is the transfer of all or a portion of an insurer’s risk through an insurance policy, to another insurance company.

What are the two types of reinsurance?

What is facultative reinsurance?

What governing body has the power to regulate commerce between the states and with foreign governments?

What does the NAIC do?

No person can act as an agent or broker, and in some cases, fee-paid counselors, without first obtaining __________.

What are the three basic functions of a life insurance company?

__________ has been defined as “the creation of a demand for a company’s products, its distribution, and services for customers who purchase that product.”

What is a broker?

What is considered to be the beginning of an insurance contract?

What is a misrepresentation?

Who do aviation exclusions apply to?

A tertiary beneficiary is __________.

The __________ assumes that the primary beneficiary died before the insured.

__________ option permits the death benefit to be distributed in more than one payment of a fixed amount that is either originally specified by the policy owner or selected by the beneficiary.

Life income is a benefit that __________.

What disease prompted the creation of viatical settlements?

Which rider benefits rider provides for the payment of all or a portion of the death benefit of the policy prior to the death of the insured if the death of the insured is caused by some specific medical condition?

A payor benefit __________.

With a limited payment whole life policy, the policy remains in full force for the “whole of life” but premiums are paid for __________.

A __________ is a policy or a rider on a contract, that provides for whole life insurance for the father or mother, and with term insurance for the other family members.

Employees usually have a __________ period during which they are not eligible for coverage.

Under US law, the first __________ of employer-provided group term life insurance is non-taxable to the employee.

What test defines an MEC?

At the onset of a universal life policy, the policy owner chooses from __________ death benefit options.

Are premiums tax deductible?

Under __________ and __________ options, every payment is considered to be comprised of principal and interest.

What are financial objectives comprised of?

What are the three areas is life insurance categorized in for a business?

What are the two functions of underwriting in life insurance?

A small business is defined as having how many employees?