A. Which type of multiple protection policy pays on the death of the last person? In the case of an insurance contract, the contracting parties are the claimant and the insurer. the contract is voidable upon proof of fraud. A life insurance contract guarantees to the beneficiary not only a death benefit, but a payment of a sum of money in perpetuity, called a death benefit for that purpose of insurance coverage. Which of the following policies does NOT build cash value? According to the Affordable Care Act (ACA), insurers can no longer deny health coverage due to pre-existing conditions unless that plan is a (n) Grandfathered plan Accident plan Individual plan Group plan Grandfathered plan The policy may be paid up early by using accumulated cash values The policy may be paid up early by using policy dividends The policy's premiums will increase after 20 years The policy's cash values steadily decrease after 20 years, the policy would be payable, minus the premium amount, If an insured dies during the grace period with no premiums paid the policy would be payable, minus the premium amount the policy would be payable only after the beneficiary makes past due premium payment all past premiums will be refunded with interest the claim would be denied, In what part of an insurance policy are policy benefits found? A) One party is restored to the same financial position the party was in before the loss occurred. Free Flashcards about Stack #2476860 - StudyStack Legal Consideration Competent parties Countersignature, A contract that requires certain conditions or acts by the insured individual, Which of the following BEST describes a conditional insurance contract? Tom's spouse Bob's estate Bob's spouse Tom, Which contract element is insurable interest a component of? Insurer's promise to pay benefits A paid premium Legal purpose Intent, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties, What is implied authority defined as? Which Of The Following Best Describes A Conditional Insurance Contract they are "take it or leave it" contracts. Which of the following does a life insurance policy summary normally include? During periods of inflation, annuitants will experience a decrease in purchasing power of their payments. B) Indemnity Both partners are still married at the time of Bob's death. Which of the following is NOT considered rebating? Loan against the cash value Policy withdrawal Policy dividend Death benefit, A business will typically use which type of life insurance to cover their employees? Of the following dividend options, which of these is taxable? D) Authority given to an agent to act outside the scope of the agency agreement, B) Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties, Legal purpose is a term used in contract law meaning Insurance Quiz (MCQs) Archives - Management Notes For a trip to the hospital, Evan Appleton paid $1,656 in hospital charges, a$750 insurance deductible, and a $457 co-payment. A) definitions which of the following best describes a conditional insurance contract? Only the insurance company has legal obligations. Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling? Eventually, they retire and dissolve the business. Updated 10/6/2017 9:10:03 AM. It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. B) A contract that has the potential for the unequal exchange of consideration for both parties The above question Which of the following BEST describes a conditional insurance contract?, Was part of Insurance MCQs & Answers. C) A contract where one party adheres to the terms of the contract Chapter 3 Legal Concepts of the Insurance Contract - Quizlet term, whole, and universal life insurance increasing term insurance joint, credit, and group life insurance adjustable, permanent, and limited-pay life insurance, Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index. B) written contract The insurers obligation to pay a death benefit upon an approved death claim. Declarations Entire contract Waivers Conditions, A whole life policy option where extended term insurance is selected is called a(n) dividend option settlement option nonforfeiture option interest-only option, Which of these would limit a company's liability to provide insurance coverage? An insurer's claim settlement practices are regulated by the Securities and Exchange Commission (SEC) National Association of Claims Adjusters (NACA) National Association of Insurance Commissioners (NAIC) State insurance departments, A life insurance company has transferred some of its risk to another insurer. _______ is the authority given to a producer to transact business on behalf of the insurer. Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium". A contract that requires certain conditions or acts by the insured individual This means that the insurer's promise to pay benefits depends on the occurrence of an event covered by the contract. A) Insurability Which of the following is the best descriptive word? The period of coverage The face amount The premium payments The cash value, at a predetermined date or age, regardless of the insured's health, A Renewable Term Life insurance policy can be renewed at a predetermined date or age, regardless of the insured's health only if the insured provides evidence of insurability anytime at the policyowner's request typically with no change in premium, Pre-death distributions will become taxable, Under a Modified Endowment Contract, what are the likely tax consequences? Which of the following statements is true? If the annuitant dies before the annuity start date, The premiums paid plus interest earned will be given to the beneficiary, Anyone who makes a fraudulent statement on an insurance application in order to obtain benefits from an insurance company. Chapter3. Legal Concepts of the Insurance Contract C) Implied An unintentional violation of Utah insurance law could lead a producer to a fine of up to _____ per violation. Which of the following best describes a symbol An example of an unfair claims practice would be, Failing to effectuate prompt, fair, and fair equitable settlements of a claim. Authority given in writing to an agent in the agency agreement An insurance applicant with a below-average likelihood of loss is typically considered to be a. Which of the following best describes how you analyze a fiction text? A fixed cash value A flexible premium schedule A fixed death benefit The ability to take out a policy loan, The least expensive option to pay off a 30-year mortgage balance would be convertible term life decreasing term life adjustable term life increasing term life, Pre-death distributions are typically taxable, Which of these describes the result of a modified endowment contract that failed to meet the seven-pay test? A Dalhousie University student training for distance running finds that, after running for x hours, her distance traveled, in kilometers, is given by, y=f(x)={10xif0x35x+15if3Which of the following is the best descriptive word? A - Weegy Variable life insurance and Universal life insurance are very similar. c. income earned by Pat's spouse. Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. In this situation, who will receive Bob's policy proceeds? Identify the type of financing (stock or bond) that best answers the question. Which of the following statements correctly describes a contract of indemnity? Insurable interest Insurance exchanges Law of large numbers and risk pooling Population table data, People with higher loss exposure have the tendency to purchase insurance more often than those at average risk. Waiver of premium Juvenile waiver Guaranteed insurability Payor benefit, Which of the following is a reinstatement condition? D) errors and oversights, In an insurance contract, the insurer is the only party legally obligated to perform. What is the purpose for having an accelerated death benefit on a life insurance policy? If the other agreement or condition is performed, then the conditional contract is . Barbaras policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. A) offer and acceptance When initial premium is collected and policy is issued. B) at the time of application Principal Capacity, All of the following are elements of an insurance policy EXCEPT 0 Answers/Comments. 2003-2023 Chegg Inc. All rights reserved. Bob and Tom start a business. Use the binomial distribution to find P(x13)P(x \leq 13)P(x13) if the stain removal product's claim is correct. Provide funds to help fund retirement Provide funds to help pay taxes Provide funds for funeral expenses Provide tax deductions for premium payments, lower than the typical whole life policy during the first few years and then higher than typical for the remainder, The premium for a Modified whole life policy is higher than the typical whole life policy during the first few years and then lower than typical for the remainder lower than the typical whole life policy during the first few years and then higher than typical for the remainder normally graded over a period of 20 years level for the first 5 years then decreases for the remainder of the policy, The type of policy which pays on the death of the last person is called joint life survivorship life dual life shared life, A life insurance policy that is subject to a contract interest rate is referred to as adjustable life group life term life universal life, a policy that is paid up after only one payment, A single premium cash value policy can be described as a policy that is paid up after only one payment a policy that only requires an annual payment a policy that is guaranteed issue a policy that covers two or more lives, A limited payment whole life policy provides protection for 20 years lifetime protection protection for more than one person discounted premiums, A policyowner may change two policy features on what type of life insurance? The terms and conditions of insurance contracts should be carefully reviewed by policyholders before signing. Because insurance premiums are tax-deductible Because dividends are already subject to capital gains Because dividends are payable directly to the policyholder Because dividends are considered to be a return of premium, A type of insurer that is owned by its policyowners is called domestic mutual stock in-house, What is considered to be the primary reason for buying life insurance? Conditional insurance contracts are insurance policies that require the insured person to satisfy certain conditions in order to become effective and/or to be paid out by the insurer. the contract must be aleatory Accelerated death benefit An example of an unfair claims practice would be offer Which of the following statements is TRUE? Food C. Plant D. Zucchini. only one party makes any kind of enforceable promise, the terms must be accepted or rejected in full, Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium". The policies continue in force with no change. In order to maintain coverage and make a successful claim, its crucial that policyholders read and understand their insurance contract carefully. Which of the following does a producer NOT have a fiduciary responsibility to? implied If xxx actually turns out to be 131313, what do you think of the claim? renewal reinstatement resumption renovation, the MEC tends to be an investment vehicle, Pre-death distributions from a modified endowment contract (MEC) receive different tax treatment than other life insurance policies because the MEC has tax deductible premiums the MEC is considered an illegal product the MEC tends to be an investment vehicle the MEC does not accumulate cash value, The face amount and premium will remain constant over the 10-year period, Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. She would like to borrow $15,000 against the cash value. definitions It allows for a spouse to be added as a rider to a life insurance policy It allows for policy loans to be advanced to the insured in the event of unemployment It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill It allows for a third party to purchase a life insurance policy at a discounted rate and immediately advance a portion of the death benefit, All of these are standard exclusions found in a life insurance policy EXCEPT hazardous occupations aviation disability war, Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue? The present cash value of the policy equals $250,000. legal reserve, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Competent parties Offer and acceptance Consideration Legal purpose, What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Where would policy proceeds be paid if both the insured and primary beneficiary were killed in the same accident? B) Contract of adhesion Dual Life insurance Joint Life insurance Last Survivor Life insurance Shared Life insurance, Index whole life insurance contains a securities component that acts as a(n) hedge against inflation premium stabilizer means to lowering taxes on earnings incentive to purchase more coverage, Which of the following are the premium payments for a Universal life policy NOT used for? Peril Hazard Loss factor Liability, Which of these techniques will remove the risk of losing money in the stock market by never purchasing stocks? WINDOWPANE is the live-streaming app for sharing your life as it happens, without filters, editing, or anything fake. C) representation A) A contract that requires certain conditions or acts by the insured individual B) A contract that has the potential for the unequal exchange of consideration for both parties C) A contract where one party adheres to the terms of the contract D) A contract where only one party makes any kind of enforceable contract. Andy the annuitant dies before the annuity start date. What does a life insurance policy guarantee to the stated beneficiary upon the death of the insured? weegy. Administrative actions taken against a producer must be reported to the Commissioner within ____ days. C.$2,113 Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed in Ken? A) Unilateral contract It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill. James is the insured on a life insurance policy where his age was misstated on the application. Competent parties express, ______ is NOT an element of a valid contract. The gap between the total death benefit and the policys cash value. A unilateral contract is one in which only one party makes a legally binding guarantee. The agent's obligation to provide the proper amount of coverage The insurer's obligation to return all premiums upon an approved death claim The insurer's obligation to pay a death benefit upon an approved death claim The agent's obligation to pay a death benefit upon an approved death claim, Of the following dividend options, which of these is taxable? Premium clause Consideration clause Adhesion clause Contestability clause, When the principal gives the agent authority in writing, it's referred to as express authority implied authority apparent authority imposed authority, Ambiguities in an insurance policy are always resolved in favor of the insured producer insurer underwriter, ______ is NOT an element of a valid contract. Which of the following would be an act of Unfair Discrimination by an insurer? What Benefit Does The Payor Clause On A Juvenile Life Policy Provide? Interest on policy loans is tax deductible Premium payments are tax deductible Pre-death distributions will become taxable Cash value cannot be surrendered early, seeks temporary protection and lower premiums, Term insurance is appropriate for someone who seeks living benefits for themselves seeks a policy that builds cash value seeks temporary protection and lower premiums seeks permanent protection and higher premiums, Shirley has a $500,000 10-year non-renewable level term life policy. C) Consideration Authority given to an agent to act outside the scope of the agency agreement, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties, When the principal gives the agent authority in writing, it's referred to as apparent ______ is NOT an element of a valid contract. The policies continue in force with no change. How does life insurance create an immediate estate? A) Unilateral A) Make whole Georgia Life Insurance Exam Ch. 2 questions & answers for quizzes and A) warranty A) fiduciary bond C) Aleatory The insured, on the other hand, makes few, if any, legally binding promises to the insurer. there is the potential for an unequal exchange of value Provide death benefits Provide money for retirement Provide living benefits Provide money for college, The Do Not Call Registry offers exemptions for calls placed from all of the following EXCEPT charities political organizations insurance sales calls surveys, protect consumers with guidelines regarding credit reporting and distribution, The Fair Credit and Reporting Act's main purpose is to assist in the underwriting of insurance policies protect insurers from an applicant's misrepresentation protect consumers with guidelines regarding credit reporting and distribution assist an insurer in determining an applicant's creditworthiness, What kind of life insurance policy issued by a mutual insurer provides a return of divisible surplus? B) other insurance Key elements of Organizational Behavior - People, Structure ,Technology & External Environment | Organizational Behavior, Penology - Meaning, Types, Importance, Scope and Example | Sociology, Karmachari Sanchaya Kosh - | Employees Provident Fund Nepal, Perceptual Errors -Types of Perceptual Error | Fundamentals of Organizational Behaviour, Difference between Manufacturing and Service Operations | Operation Management. performance is conditioned upon a future occurrence. Net death benefit will be reduced if the loan is not repaid No interest will be charged on loan balance Term life policies are the only type of insurance that allows policy loans A loan can be taken out for up to the face amount of the policy, Ownership of a life insurance policy may be temporarily transferred with a(n) collateral assignment absolute assignment transferable assignment beneficiary assignment, provide evidence of insurability to the insurer, In order to activate the reinstatement clause of a lapsed life insurance policy, the insured MUST remit all past-due premiums within the grace period provide evidence of insurability to the insurer resubmit a new life insurance application provide a valid reason for the lapse, Which of the following is considered to be an alternative to a life settlement? D) misrepresentation, Which of the following is NOT required in the content of a policy? A double indemnity benefit will be payable to Matts beneficiary is Matt, All of the following riders can increase the death benefit amount EXCEPT, All of these are valid policy dividend options for a life insurance policyowner EXCEPT, The premium for a Modified whole life policy is, Lower than the typical whole life policy during the first few years and then higher than typical for the remainder, A nonparticipating company is sometimes called a(n), Intentional withholding of material facts that would affect an insurance policys validity is called a(n), Signatures for an insurance application MUST be obtained by the producer from all of the following sources EXCEPT. B) premium only B) Unequal consideration acceptance What is the name of the provision which states that a copy of the application must be attached to the policy when issued? Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary? Connect the text to your own experiences. Which of the following Best Describes a Conditional Insurance Contract Posted on April 19, 2022 by Ephori London To be enforceable, a contract must be concluded by the competent parties. Returning a portion of a premium as inducement to purchase insurance, An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example of, Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out. Can be converted to permanent coverage without evidence of insurability Coverage can be different for each child Premiums on this rider are not required until the limiting age is reached Increases the policy's overall cash value, Which type of policy combines the flexibility of a universal life policy with investment choices? Typically, bilateral contracts involve an equal obligation or. D) Personal contract, The importance of a representation is demonstrated in what rule? representation Rob recently died at age 60. Preferred risk policies with reduced premiums are issued by insurance companies because the insured has, Better than average mortality or morbidity experience. Authority given in writing to an agent in the agency agreement Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties Authority given to handle claims and process payments Authority given to an agent to act outside the scope of the agency agreement, The authority granted to a licensed producer is provided via the producer's apparent authority written contract Law of Agency Principal Capacity, Insurable interest does NOT occur in which of the following relationships? What is created after policy proceeds are obtained in a lump sum and then immediately invested? Policyowner has the right to select the investment which will provide the greatest return. Science Study Guide Questions. D) Terminate the agent, Insurable interest does NOT occur in which of the following relationships? A) Insurer's promise to pay benefits A) the appearance of authority an insurer gives to its agent D) Insurance producers, If a material warranty violation on the part of the insured is found, what recourse does an insurer have? A) Sister and brother D) imposed authority, What makes an insurance policy a unilateral contract? D) collateral, Express power given to an agent in an agency agreement is To see this page as it is meant to appear, please enable your Javascript! C) Bob's spouse Law of large numbers U.S. Census Average mortality incidents Experience of morbidity, Insurance represents the process of risk selection avoidance transference assumption, Doctors pooling their money to cover malpractice exposures, An example of risk sharing would be Adding more security to a high-risk building Choosing not to invest in the stock market Doctors pooling their money to cover malpractice exposures Buying an insurance policy to cover potential liabilities, All of the following are examples of pure risk EXCEPT Losing money at a casino Injured while playing football Falling at a casino and breaking a hip Jewelry stolen during a home robbery, the terms must be accepted or rejected in full, Under a contract of adhesion, there is the potential for an unequal exchange of value the insurer's obligations are dependent upon certain acts of the insured individual the terms must be accepted or rejected in full only one party makes any kind of enforceable promise, According to life insurance contract law, insurable interest exists when any business relationship exists at the time of application at the time of death only when determined by a judge, In an insurance contract, the insurer is the only party legally obligated to perform. What are conditions in an insurance policy? B) conditional Eventually, they retire and dissolve the business. Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. A provision that allows a policyowner to withdraw a policys cash value interest free is a(n), The Do Not Call Registry offers exemptions for calls placed from all of the following EXCEPT, All of these are valid options for an Adjustable Life Policy EXCEPT, The policys premium can be increased or decreased, An insurers claim settlement practices are regulated by the. Both partners are still married at the time of Bob's death. Before using an assumed name in Utah, a producer MUST, Maria would like an annuity that provides a guaranteed accumulation or payout. It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. Lisa has recently bought a fixed annuity. Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. Chapter 3: Legal Concepts Flashcards | Quizlet Which contract element is insurable interest a component of? Because of this, an insurance contract is considered voidable conditional aleatory unilateral, Who is responsible for assembling the policy forms for insureds? Accumulation at Interest Option Cash Dividend Option Paid-Up Additions Option One-Year Term Dividend Option, The policy may be paid up early by using policy dividends, Pat owns a 20-pay life policy with a paid-up dividend option.