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? 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? D) the contract must be a contract of adhesion, C) there must be legal reasons for entering into the contract, Ambiguities in an insurance policy are always resolved in favor of the 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. Which of the following best describe the term definition D) only when determined by a judge, Xcel Chapter 3 Legal Concepts of the Insuranc, Chapter 3 Exam - Legal Concepts of the Insura, Chapter 4 Exam - Life Insurance - Types of Po, 4 - (Questions) Life Insurance Policies - Pro, Chapter 5: Life Insurance Premiums, Proceeds,, Chapter 4: Type of Insurance Policies Part 1, Chapter 4: Policy Provisions, Options and Rid, Calculus for Business, Economics, Life Sciences and Social Sciences, Karl E. Byleen, Michael R. Ziegler, Michae Ziegler, Raymond A. Barnett, Fundamentals of Engineering Economic Analysis, David Besanko, Mark Shanley, Scott Schaefer, The Cultural Landscape: An Introduction to Human Geography, AP Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Unit 7 AP Env. A policy containing exclusions or limits that are not clearly disclosed to the policyholder, or a premium that is significantly higher than the risk covered, could be considered unfair or one-sided. Which of these statements is true? 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. The terms of the policy typically outline these conditions, which may include paying premiums on time and maintaining the insured property in good condition. C) consideration When the principal gives the agent authority in writing, its referred to as, The terms must be accepted or rejected in full. Which of the following would be a valid reason why a policy premium would be higher than the standard premium? During periods of inflation, annuitants will experience a decrease in purchasing power of their payments. A) One party is restored to the same financial position the party was in before the loss occurred B) The unequal exchange of value or consideration for both parties C) One party (the insurance company) prepares the contract with no negotiation between the applicant and insurer D) Only one party (the insurer) makes any kind of enforceable promise A) Insurability C.$2,113 The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? c. income earned by Pat's spouse. In the case of an insurance contract, the contracting parties are the claimant and the insurer. conditions, Legal purpose is a term used in contract law meaning What are conditions in an insurance policy? Multiple-choice. Sharon is the policyowner of a $500,000 life insurance policy. Which type of multiple protection policy pays on the death of the last person? Modified Endowment Contract Current assumptive whole life Credit life insurance Equity index whole life, What kind of life insurance policy covers two or more people with the death benefit payable upon the last person's death? What is the name of the provision which states that a copy of the application must be attached to the policy when issued? B) concealment Aleatory Contract: A contract type in which the parties involved do not have to perform a particular action until a specific event occurs. A) warranty The insurers obligation to pay a death benefit upon an approved death claim. B) A contract that has the potential for the unequal exchange of consideration for both parties An insurance contract usually involves an exchange of consideration between both parties: the insurer agrees to provide coverage and pay claims in the event of a loss, and the policyholder agrees to pay premiums in return. A) Authority given in writing to an agent in the agency agreement ______ is NOT an element of a valid contract. A) Tom's spouse Child term rider Payor rider Family maintenance rider Family income rider, What happens to the coverage under a children's term rider when that child reaches a certain specified age? 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? A contract that requires certain conditions or acts by the insured individual A contract that has the potential for the unequal exchange of consideration for both parties A contract where one party "adheres" to the terms of the contract Sharing commissions with a producer licensed in the same line of business. Which of the following would be an act of Unfair Discrimination by an insurer? Anheuser-Busch InBev is trying to reduce its water usage. A) Sue the insured Adjustable life policy Modified life policy Endowment policy Universal life policy, How are survivorship life insurance policies helpful in estate planning? Apparent The Fair Credit Reporting Acts main purpose is to, Protect consumers with guidelines regarding credit reporting and distribution, A whole life insurance policy accumulated cash value that becomes, The policy loan value which the insured may borrow against. Which of the following is a reinstatement condition? Which of the following best describes a symbol. b) a contract is an agreement enforceable at law. Rob purchased a standard whole life policy with a $500,000 death benefit when we was age 30. Policy loans are disallowed The premium payments will be tax deductible Pre-death distributions are typically taxable Withdrawals will be prohibited, When a whole life policy is surrendered, income taxes may be owed, All of these statements concerning whole life insurance are false EXCEPT Policyowner can take out a policy loan up to the face amount When a whole life policy is surrendered, income taxes may be owed Coverage is normally temporary The death benefit is not affected by outstanding loans, A life insurance policy which contains cash values that vary according to its investment performance of stocks is called Increasing Term Life Modified Whole Life Variable Whole Life Adjustable Whole Life, Which of these riders will pay a death benefit if the insured's spouse dies? What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30-year period? How do insurers predict the increase of individual risks? This is also known as a non-negotiable insurance contract, or an automatic contract. Authority given to handle claims and process payments ______ is NOT an element of a valid contract. This is an example of: An example of unfair discrimination would be, When an insurer charges a higher rate for insurance based on an insureds race, religion, or national origin, Fixed period settlement options are considered to be a form of a(n). What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30-year period? A) Only the insured pays the premium However, corporations also can raise money by selling bonds or issuing additional shares of stock. B) conditional Premiums paid plus interest earned is returned to the beneficiary. (C) Both parties exchange goods of equal value. $2,406 If she dies 15 years after the policys inception date, how much will her beneficiary receive? C) Business partners The authority granted to a licensed producer is provided via the B) the unwritten authority that the agent is assumed to have Under the Fair Credit Reporting Act, what is the maximum penalty that may be imposed in Ken? Which market index is normally associated with an indexed annuitys rate of return? A) State Insurance Departments Premium clause Corporations, like all firms, can raise money by borrowing from banks and other lending institutions. claim forms An insurance applicant with a below-average likelihood of loss is typically considered to be a. D) Terminate the agent, Insurable interest does NOT occur in which of the following relationships? D) errors and oversights, In an insurance contract, the insurer is the only party legally obligated to perform. Express warranty guarantee representation collateral, there must be legal reasons for entering into the contract, Legal purpose is a term used in contract law meaning there must be an offer and acceptance the contract must be aleatory there must be legal reasons for entering into the contract the contract must be a contract of adhesion, In an insurance contract, the element that shows each party is giving something of value is called offer acceptance consideration purpose, What makes an insurance policy a unilateral contract? which of the following best describes a conditional insurance contract? Conditional Contracts: Everything You Need to Know - UpCounsel Loans obtained by a policyowner against the cash value of a life insurance policy. C) Indemnity contract An example of an unfair claims settlement practice is, Turning down a claim without providing the basis of denial. Identify the type of financing (stock or bond) that best answers the question. D) Consideration clause, When the principal gives the agent authority in writing, it's referred to as collateral, What is implied authority defined as? Risk reduction Risk transference Risk avoidance Risk retention, The cause of a loss is referred to as a(n) hazard adversity peril risk, How do insurers predict the increase of individual risks? 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. Juvenile insurance Family income insurance Spouse insurance Term rider, A life insurance policy written on one contract for two people in which it is payable upon the first death is called Split Shared Joint Survivorship, Level premium permanent insurance accumulates a reserve that will eventually equal the face amount of the policy pay a dividend to the policyowner require the policyowner to make periodic withdrawals become larger than the face amount, A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a(n) adjustable policy limited pay policy level term policy variable universal policy, term, whole, and universal life insurance, What types of life insurance are normally used for key employee indemnification? Both partners are still married at the time of Bob's death. purpose, Insurable interest does NOT occur in which of the following relationships? Adjustable life insurance Decreasing term insurance Increasing term insurance Modified life insurance, A spouse and child can be added to the primary insured's coverage as what kind of rider? Which of the following BEST describes a conditional insurance contract? The policies continue in force with no change. offer Which of the following BEST describes a conditional insurance contract? A) Competent parties A Modified Endowment Contract (MEC) is best described as A life insurance contract which accumulates cash values higher than the IRS will allow An annuity contract which was converted from a life insurance contract A modified life contract which enjoys all the tax advantages of whole life insurance A life insurance contract where all withdrawals Log in for more information. 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? d. a deductible stated in the policy's provision. Term insurance is appropriate for someone who, Seeks temporary protection and lower premiums.