All Of These Are Settlement Options For Life Insurance Except

Question: Mortality is calculated by using a large risk pool of

hobbies and time

people and time

family history and geographical area

insurance companies and agents

Answer: people and time

Question: Which of these factors help determine an insured’s life insurance premium?

insured’s salary

marital status

place of residence

avocation (hobby)

Answer: avocation (hobby)

Question: Tonya has replaced her whole life policy with an annuity without incurring a tax penalty. This transaction is called a(n)

Modified Exchange

Endowment Exchange

1040 Exchange

1035 Exchange

Answer: 1035 Exchange

Question: Proceeds from a life insurance policy are protected from the beneficiary’s creditors by which clause?

protection clause

creditor clause

spendthrift trust clause

beneficiary trust clause

Answer: spendthrift trust clause

Question: A life insurance claim which involves a per capita distribution of policy proceeds would be payable to the

estate of the insured only

estate of the deceased beneficiaries only

named contingent beneficiaries only

named living primary beneficiaries

Answer: named living primary beneficiaries

Question: How does life insurance create an immediate estate?

Cash value may be borrowed upon at any time

Nonforfeiture options are immediately available

The insured’s estate receives the death benefit

After first premium is paid, the face amount may be available to the beneficiary

Answer: After first premium is paid, the face amount may be available to the beneficiary

Question: An example of naming a beneficiary by class would be

“To the children born of my union with Ned Jackson: David Jackson, Jennifer Jackson, and Scott Jackson”

“To the child born of my union with Ned Jackson: Scott Jackson”

“To the children born of my union with Ned Jackson”

“To Ned Jackson”

Answer: “To the children born of my union with Ned Jackson”

Question: All of these are settlement options for life insurance policies EXCEPT

Life income

Lump sum

Extended term

Fixed period

Answer: Extended term

Question: Sharon is the policyowner of a $50,000 life insurance policy. Her son, Mike, is the beneficiary. If Sharon MUST obtain Mike’s signature in order to change the beneficiary, what kind of beneficiary designation is this?

Tertiary

Contingent

Revocable

Irrevocable

Answer: Irrevocable

Question: Elizabeth is the beneficiary of a life insurance policy. She is receiving the death benefit in payments of $10,000 per month until the principal and interest has been paid out. Which option was chosen?

Fixed period

Fixed amount

Life income

Interest only

Answer: Fixed amount