S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. II. \hline \text { Jul 1 } & 5,500 &&\\ B) Once the cash surrender value option is selected, the coverage is terminated and the policy cannot be reinstated. Reinsurer Assuming company. & \text{ ???? } a) Offering additional coverage to clients Pro rata liability applies. 4. Investors become more risk averse. a) Indeterminate Premium A surplus lines broker deals with direct writing companies only D. Represent the insured's interest Which of the following documents must be provided to the policyowner or applicant during policy replacement? also known as acceptance. EMPIRECOMPANYIncomeStatementFortheMonthEndedOctober31,2017\begin{array}{c} Life Insurance Basics Flashcards | Quizlet All of the following statements concerning coinsurance are true, EXCEPT . (d) annual premium and the annual policy dividend. Is There An Objective Morality? IAI TV All of the following are personal uses of life insurance EXCEPT, All of the following are true of key person insurance except, D. The plan is funded by permanent insurance only. A key person insurance policy will pay for costs of running the business and replacing the employee. If the initial premium is not paid with the application, the agent will be required to collect the premium at the time of policy delivery. 1. Where does group-life insurance come from? -it pays the double indemnity, 1)accident occurs, person must die within 90 days Which of the following best illustrates a ~~~\text{Depreciation on sales equipment}&45,000\\ C. Consideration If the ultimate consumer is a business that collects and pays to the government VAT on . C. Countersign insurance contracts Group life insurance is most often issued as guaranteed annual renewable term. 1)Statement of continued good health What else must he include? 17,000, InventoryJul122,000???? Jul3125,500\begin{aligned} ~~~\text{Rent on factory facilities}&60,000\\ d) The Guaranty Corporation. Domestic Insurer 3) Increasing Term. An inexperienced assistant accountant has prepared the following income statement for the month of October 2017. Which of the following types of insurance policies would perform the function of cash accumulation? when the applicant/owner is not the insured-3rd party When an applicant pays the initial premium the agent will give them a what? After everything is signed & premium is collected What does the agent give to the policy holder? (c) conversion provision \hline (\$ 000) & 1 & 2 & 3 & 4 \\ (c) face amount of the policy and the legal reserve. 3)low premiums. There is a minimum guaranteed interest rate on all sub-accounts. a) Premium amounts and surrender values B) Human life value approach is determined by the loss of income that would result with the death of the insured, after making adjustments for expenses, inflation, etc. They keep a high percentage of any interest earned on their policies (b) Cash value accumulation is slow to moderate. Payor benefit/Clause is always a _________. Which $50,000 life insurance contract if purchased when the insured was 32, would have the highest cash value when the insured is 50? It requires evidence of insurability for renewal. Policy Holders/Shareholders have the ability to vote for members of the board of directors or governing body of the company.. this is called their____________? The failure to disclose known facts is what? \end{aligned} You cannot sell a variable policy without what? Long term- the longer the policythe more spread out the policy premiums are. These individuals qualify for lower premiums than those in the other categories. Causes of the 2000s United States housing bubble - Wikipedia A SEC registration. Both life and health insurance can be used for a variety of purposes in a business setting, including the funding of business continuation agreements, compensating executives, and protecting the firm against financial loss resulting from the death or disability of key employees. Endowments means policy is what(2) things? insurable interest must exist. Which model is the better fit for the data? 3)substandard-highest, 6 factors that are complete for policy 2 be paid? -20 pay life-paid up at 65 All of the following are characteristics of group life insurance EXCEPT. b) Increasing Premium ____________ insurer is not a type of insurer. Which of the following is the basic source of information used by the company in the risk selection process? Insurance is designed to provide protection against which of the following? The profit per night for each type of room and rental class is as follows: RentalClassRoomSuperSaverDeluxeBusinessTypeI$30$35TypeII$20$30$40\begin{aligned} -guarantee a stream of income to the person purchasing it known as the annuitant. 6)Explain Free Look period-10-30 days- unconditional refund that begins when policy is delivered. All of the following statements about the settlement of a claim are true EXCEPT. In addition, they provide financial support for Tom's aged father and Nancy's aged mother. WorkinProcessFactoryOverheadCash$229,040.0078,960.00250,558.00EmployeeIncomeTaxPayableSocialSecurityTaxPayableMedicareTaxPayable$33,880.0019,096.004,466.00. An annuity is exchanged for another annuity. 2) premiums do not change A. An underwriter will consider each of the following factors when evaluating a risk, except: A. Whoso. C) the proposed insured. What does it mean when a policy is limited pay life? &\text { Cash }\\ An insurer that is incorporated in the same state that they are doing business in is a_____________.? A Contract that binds only one party to future performance, is a (n): A. If the conversion cost is the same for both types of rooms, would you recommend converting the office to a Type I or a Type II room? All of the following are true regarding health insurance policies, EXCEPT: A) An agent or producer may not make changes to the policy B) Once issued, a policy may only be changed with the approval of a company officer C) An agent may change an application with the verbal consent of the applicant b. persistent fear of germs c) Counselor Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values, and death benefits for specific years? Despite this, the country has significantly worse healthcare outcomes when compared to peer nations. (d) neither I nor II. Who is not a party to the contract and receives the benefits when the insured dies? All of the following statements are true regarding mortgage protection insurance EXCEPT. D) When immediate annuities are used to pay IRA benefits, distributions must begin no later than age 70 in order for the annuitant to avoid penalties. 25,500, AccountspayableJul114,500???? & &&\textbf{ Quarter } \\ When applicant is not the insured ______________ must exist. B. this insurance is often written in connection with automobile loans. a) The policy can be converted to term coverage. A ____ contract requires that both parties perform certain duties. c) The inspection report D) The Life and Health Insurance Guaranty Corporation protects Maryland residents who are policyholders, insureds, beneficiaries, annuitants, and assignees of life and health insurance policies, annuities, and supplemental contracts, if the insurer issuing the policies fails to perform its contractual obligations because it becomes impaired. Fraud Now Tamara can afford whole life insurance. a. mentally counting backward from 1,0001,0001,000 * 50% is paid B. b) 10% for early withdrawal Age, Sex, Occupation, Hobbies, Habits, Smoking or Non-Drug user or Non. Its controller resigned in October 2017. Solved All of the following statements about variable life - Chegg There is no limitation on the number of key employee plans in force at any one time B. a) Withdrawals are not taxable. CPI (consumer price index) without evidence. Department of Defense I. Which kind of agent enters into agreements with more than one insurer? The accounting records of DVD Sales, Inc., include the following accounts: CashJul15,500???? Why?". (b) reduced. (b) current assumption whole life. Companies may have immediate legal obligations following the inclusion of a substance in the Candidate List on this website including in particular Articles 7, 31 and 33 of the REACH Regulation. (Choose from the following options) Correct: D. Department of Treasury, The Terrorism Act, which protects consumers by addressing market disruptions and ensuring the continued widespread availability and affordability of property and casualty insurance for a terrorism risk, is a administered by the Department of Treasury. S buys a $10,000 Whole Life policy in 2003 and pays an annual premium of $100. The issuance of a policy or binder is not part of the consideration element of an insurance contract, it is part of the _______ ________. B) Passing examination with 75% or higher score. Because the insurance company must pay claims and the insured must comply with the policy terms, the insurance contract is considered which of the following types of contracts? Predicted needs of the family after the insured's death Pertaining to insurance, what is the definition of a fiduciary responsibility? 3)premium is collected Are insurance company underwriters allowed to discriminate? InventoryJul1Jul3122,000???? still matures at age 100, -premium is paid off at one time Predicted needs of the family after the insured's death B) The reduced paid-up nonforfeiture option would provide protection until the insured reaches 100, but the face amount is reduced to what the cash would buy. d) Joint and Survivor, B) The Waiver of Cost of Insurance rider is found in Universal Life policies. AccountspayableJul1Jul3114,500??? (b) Prepare a correct income statement for October 2017. Annual income A. b. If company pays dividends, then they are a? Liquidity in life insurance refers to availability of cash to the insured through cash values. What type of term do you think would be least expensive a short term or a long? c. 3. A policy summary usually includes all the listed information, and must be delivered along with a new policy. Which of the following is a financial rating service? &\text { Accounts payable }\\ When must insurable interest exist in a life insurance policy? a) Payor rider. d) Performing reviews of insured's coverage. Group Life Insurance Flashcards | Chegg.com The interest rate credited to the cash value at the time of issuance remains fixed over the life of the policy. 3,000, AccountsreceivableJul121,000???? B. Insureds current and future income When Applicant P fails to disclose all of his motor vehicle violations in an application for automobile insurance, he may be guilty of: A. Estopple \end{aligned} Six Reasons the Loss is Excluded - MyNewMarkets.com Who assumes control over an insurance company's funds and management if it becomes insolvent? Hazard What are the two options in death benefit options? When an agent collects the initial premium from the applicant, the agent should issue the applicant a. C. Certain Risk An individual applies for a life policy. A. 4)Explain the policy and its provisions 4) 3 components to the premium, The owner and the insured are different people. b. it frequently includes coverage for losses due to casualty and theft. (a) renewal provision Nature of risk \hline && \text { Jul 1 } & 65,000 \\ \text{Dividend}& 19,000& \text { Net Inc } & 65,000 \\ baseball, fishing | 2K views, 10 likes, 0 loves, 0 comments, 2 shares, Facebook Watch Videos from 800 Pound Gorilla Media: Robert talks about fishing in NYC, baseball, and growing up with protective. Correct: B. A linear programming model developed to maximize profit is used to determine how many reservations to accept for each rental class. 2) Transferring the risk A peril Which of the following methods of calculating the amount of life insurance needed takes into account the insured's wages, years until retirement, and inflation? Arrest History. -below market interest rates on borrowing DepreciationExpense-FactoryEquipmentDepreciationExpense-BuildingHeat,Light,andPowerExpenseInsuranceExpense-Factory$5,770.242,822.409,055.201,505.28MiscellaneousExpense-FactoryPayrollTaxesExpense-FactoryPropertyTaxExpense-FactorySuppliesExpense-Factory$13,780.4843,736.006,088.3218,063.36. If the corporation collects the policy benefit, then Which of the following statements about a life insurance policy is (are) true? A contract between insurer and policy holder. The companys president is concerned about the accuracy of the income statement. If the insured commits suicide after the 2 year period, the policy will pay the death proceeds to the designated beneficiary the same as if the insured had died of natural causes. Most agents try to collect the initial premium for submission with the application. L4. Life Insurance Policy Provisions Options and Riders D. group credit insurance must have a suicide clause . The policy is a contract of adhesion Exclusion Categories What type of policy does the insured most likely have? Which of the following is usually true of a participating life insurance policy? "Round Tree Manor is a hotel that provides two types of rooms with three rental classes: Super Saver, Deluxe, and Business. (b) Cash value accumulation is slow to moderate. 1)tax qualified plans C. A husband or wife has an insurable interest in their spouse C) Annually renewable term policies provide a level death benefit for a premium that increases each year with the age of the insured. a) Material change 1) the premium amount Tom and Nancy Boyle provide financial support for their two children. a) Juvenile Life D) Members of the uniformed forces can obtain term group life insurance through Servicemembers' Group Life Insurance (SGLI). ~~~\text{Raw materials purchases}&\$264,000\\ Which of the following is the basis for a claim against an insurance policy? b) Hazard Other factors that are named include "Mortgage underwriters, investment banks, rating agencies, and investors", "low mortgage interest rates, low short-term interest rates . All of the following are true of negligence, except: - AZanswer Insurance producers must ensure that contracts they recommend are in the best interest of the insured. All of the following would be exempt from the producer licensing requirements EXCEPT: A) A customer service representative who discusses policies. 5)an agreement is set, 1)Level term(cheapest insurance) face value stays the same M327. \text { Type II } & \$ 20 & \$ 30 & \$ 40 (d) Most policies have a CV that is refunded when coverage ceases. -Prepays portion of face amount if diagnosed with terminal illness. -The insurance dept. A _______ __ is the additional premium needed to get covered with high or substandard risk. Which of the following would provide an underwriter with information concerning an applicant's health history? Why do most states have a waiting period for couples applying for marriage licenses? &\text { Accounts receivable }\\ b) Human life value approach B. IRS has no jurisdiction -receiving dividends(when declared) The cash value of availability to the policyowner The agent Can term insurance be both renewable and convertible? a. whole life paid at 65 1) mentally incompetent persons 3)Consideration The applicant's medical background is addressed in Part 2 - Medical Information. D. The ratings are available to the public An Insurer organized in another state than the state in which it is authorized to do business is known as which type of insurer? A company that does business in another state than incorporated who is owned by policyholders who received dividends when declared and voting rights. A. Conditional Contract Daycare is considered to be among these expenses. \end{array} \\ Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, ICEN6003: IC Engines Operation and Constructi. Warranty The insurer's promise to pay a covered loss and the insured's payment of the first premium, are examples of: A. The following are all true regarding risk management, except: A. C. Social Security works exactly same as private insurance. The policy's cash value grows as the investments grow. All of the following are true of key person insurance EXCEPT ) The key employee is the insured. See Answer. -Can't lose value Their premiums are lower &\text { Accumulated depr.-equipment }\\ \end{aligned} Jul3117,000\begin{aligned} &\begin{array}{lccc} Address of his principal office \hline \text { Jul 31 } & 25,500 -the premiums are paid for a limited time only. There are 2 parties of the contract- what are they? Type I rooms do not have wireless Internet access and are not available for the Business rental class. A. Which of the following statements is not correct regarding rates and premiums? D. Agents report. a. A producer wishing to appeal the final order of the commissioner would appeal to???? All of the following statements are TRUE concerning Debtor Groups EXCEPT The person who receives the benefit when insured dies. -Staged intervals Correct: C. Concealment, A. The policyowner has a variety of options for investment of the cash value. \text{Sales revenue}&&\$780,000\\ B. Aleatory contract Correct: D. Concealment. C. Premiums are tax deductible by the key employee Universal Life is also known as two things what are they? All of the following are business uses of life insurance EXCEPT 1)Whole Life A. B. -kids till 21 Correct: A Insurance . (D The employer is the owner, payor and beneficiary of the policy. D) Insurance covers intentional losses as well as unintentional. \textbf{For the Month Ended October 31, 2017}\\ 3)they provide insurance to members. -If the insured dies, the policy payed out the PRINCIPAL SUM New York City | Robert Klein | Robert Klein At Yale (1982) | baseball The requirement that producers must account for all insurance funds collected, and without the expressed consent of the insurance company(ies) are not permitted to co-mingle those funds with their own funds is known as c) Accelerated benefit rider. The cost of a living rider is calculated by what? D) Obtaining a bachelor's degree. Hospital bills of the key employee Does not pay dividends to policyowners; however, taxable dividends are paid to stockholder. Height Weight and Health conditions. The Terrorism Risk Insurance Program is administered by which of the following Federal entities? How much life insurance should Sam advise . c) A person who handles assets or money belonging to others. the application is used at the primary source of info. Which of the following is an example of liquidity in a life insurance contract? Forms of interest and are Sensitive Whole Life, 1) Transfers risk to another insurer 2)collateral assignment-some or only one right assigned. &\text { Inventory }\\ Beneficiary's age is not a suitability factor. Renew policy holder has an option- THE INSURER DOES NOT. Each policy pays a percentage of the loss based on the percentage of coverage that policy provides. -7 pay test is used to determine If a policy is a MEC. The County is administered by a five-member Board of Supervisors who are elected for four-year terms What happens when there is a Misstatement of age or sex? A monthly deduction is made from a policy's cash value for the cost of insurance protection. b) State attorney general When will coverage begin? b) The agent's report a) Year only. Joe, Larry, and Curly own a small business. What are the (5) Factors considered with combination policies Who and What are they? Newborns after how many days become covered in a child rider? A false statement in the application for insurance is_____________. b) Promptly forwarding premiums to the insurance company C. Tax Status D. Reduction is a method of managing risk. If a parent purchases life insurance on their child all of the following are true, EXCEPT: A) The child is the insured. b) Conditional receipt C) A licensee cannot knowingly employ an individual who has been convicted of a felony or crime of moral turpitude within the past 10 years to act in a fiduciary capacity. Only one party is giving a legally enforceable promise- A one-sided contract is what? d) The insurer will sue the insured for committing fraud. B) According to the law of large numbers, the larger a group becomes, the easier it is to predict losses. Home Office- what do the underwriters do. they evaluate 4 things- what are they(4)??? 4)Consumer report=credit, -shorter time span for paying premiums (c) Most policies can be converted to a permanent life insurance policy. C) purchasing family term insurance. A. _______ pays dividends to the stock holder. -immediately considered fully paid up Life insurance proceeds The demand forecast for a particular night is 130 rentals in the Super Saver class, 60 rentals in the Deluxe class, and 50 rentals in the Business class. Their premiums are lower Statement of good health ~~~\text{Direct labor cost}&190,000\\ exclusions: when the accident occurs within an illness,disease, or mental infirmity. \\ Acceptance \hline & \text { Jul 31 } & 58,000 a) Consumer Privacy Act Government Relations: New Challenges and the Ongoing Erosion of The policyowner can add to a policy's cash value at any time subject to policy guidelines. C. Independent rating services evaluate and rate the financial ability of insurance companies \text { Type I } & \$ 30 & \$ 35 & - \\ 1) coverage is permanent All of the following statements about universal life insurance are true EXCEPT Any withdrawal of a policy's cash value reduces the amount of the death benefit. B. An agent tells an insured that if he replaces his current insurance policy with a newer one, his dividends will be higher and his premium will be slightly lower.