Primerica Practice Exam 5, Questions with accurate answers, 100% verified. Rated A.

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Primerica Practice Exam 5, Questions with accurate answers, 100% verified. Rated A. Any transaction that involves purchasing a life insurance policy and terminating an existing policy is known as... : - ✔✔Replacement According to the CA Insurance Code, in which if the following classes of insurance can a binder NOT be issued? - ✔✔Life Insurance or Auto Insurance An organization will cease to exist as an entity eligible to hold a license for all of the following reasons, except: - ✔✔Termination of key employee What does it mean if an agent's license is inactive? - ✔✔The agent cannot transact any insurance business for which a license is required If the Commissioner issues a Notice of Seizure for documents and the individual fails to send those documents what is the penalty? - ✔✔1 year in jail and/or $1000 fine Which of the following must any person engaged in the business of acting as an insurance agent or broker who receives compensation for arranging or directing sales in connection with a premium financing agreement do? - ✔✔Maintain a list of accounts in connection with compensation exempted in premium financing payments for three years. All of the following would be considered one of the three major types of loss exposures, except: - ✔✔Financial loss exposure Tony Brown has a CLU certification. Which of the following names would be automatically approved for his agency's use? - ✔✔None of these would be automatically approved A person has paid $50,000 into a fixed annuity over 20 years. When he decides to begin income payments the insurer calculates that he will receive $4,000 per year for life, which means that he will receive a total of $100,000. In the first 10 years of payments how much is taxable each year? - ✔✔$2,000 According to the code, all insurers must maintain a department to investigate: - ✔✔Possible fraudulent claims from insureds What does the Insurance Commissioner have the right to do if an agent lacks authority from an insurer named on a binder for coverage? - ✔✔Suspend or revoke the license of the agent An insured bought an annuity ten years ago. He will retire in five years. To determine the value of the annuity, the number of accumulation units is multiplied by the value of the separate account. What type of annuity was purchased? - ✔✔Variable annuity The class beneficiary designation which means that the beneficiaries will receive equal shares of the death benefit divided among the surviving members of the class is: - ✔✔Per capita The mathematical rule that says that as the number of individual but similar exposure units increases the easier it is to predict losses is which of the following? - ✔✔The law of large numbers Which of the following is a description of a Life and Disability Analyst? - ✔✔A person licensed to advise clients about life and disability insurance for a fee What happens to a license after the death of a natural person who holds a valid insurance license? - ✔✔It always terminates Which of the following are common insurance policy provisions? - ✔✔Entire contract, grace period, reinstatement With the cost of a living rider, the insurance policy holder: - ✔✔Gets the automatic increase in the face value if there is an increase in the cost of living index. There is an additional coverage All of the following is required on a life insurance application, except: - ✔✔The amount of disability income insurance in force All of the following statements regarding survivorship life insurance are true, except: - ✔✔The policy face amount is made out based only on the death of the first to die Which of the following is not an option for the use of the policy dividends? - ✔✔Fund the distribution of monthly income payment What information can a party to a contract of insurance be allowed NOT to communicate according to California Law? - ✔✔Information which the other party already knows According to CA Insurance Code, a judgment against an applicant who entered a plea of "nolo contendere" is considered to be: - ✔✔Convicted [Show More]

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