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The following are IRS requirements for qualified retirement plans except:
- The plan must have a vesting requirement just for the officers and stockholders.
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Which of the following are not regulatory requirements for dependents under group life plans?
- A dependent may be covered up to age 18 under normal circumstances.
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All of the following would qualify for a Keogh plan except
- Owners of an incorporated business.
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Annuity benefits are a combination of principal and interest. What is the taxation status of the principal?
- Both are correct statements
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Which of the following is not a major type of social security disability coverage?
- Disabled Adult Benefits.
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A widow can begin to receive full social security retirement benefits at age
- 65
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All of the following would be income tax free except
- Cash surrender amount is in excess of the premiums paid.
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Which of the following is incorrect concerning quarters?
- To be fully insured you must earn at least 1 credit being at age 21 for each year,
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Which of the following is not a major difference between social and private insurance?
- Private insurance benefits are mandated by law.
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Which of the following statements regarding annuity taxation is FALSE?
- a withdrawal from a deferred annuity under the contract's free withdrawal provision exempts the distribution from the pre-59 penalty tax
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Which of the following statements concerning currently insured is incorrect?
- The spouse with no minor children will be entitled to the widow/widower (spousal income) at age 60.
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Which statement concerning a Roth IRA Is not incorrect?
- Contributions are not deductible.
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The period of time following the youngest child's 16th birthday until the surviving parent is eligible is called
- The blackout period
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Within how many days must an employer give a terminated employee notice to convert his life policy?
- 15
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The number of credits required for fully insured status is
- 40
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Which of the following statement about profit sharing plans is incorrect?
- Yearly earnings are fully taxable in the year received.
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Of the following correct statements concerning the conversion privilege of group term life insurance which is not correct?
- There is no coverage during the conversion period if the employee/insured has decided not to exercise their right to convert.
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How much is the one time death benefit from social security?
- $255
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Upon the death of a primary breadwinner who is fully insured under Social Security, a dependent child is eligible to receive an income benefit until the age of
- 18 or 19, if unmarried and a student in elementary or secondary school
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In a seven year vesting schedule, what percentage of employer contributions is vested after seven years?
- 100%
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Which of the following statements about 401K plans is incorrect?
- 401Ks are known as a cash or deferred account or CODA.
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Vesting is best described as:
- An employee's right to ownership of the funds contributed by the employer.
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In a group policy the employer is responsible for all of the following except:
- Paying the premium and notifying the insurer of employees who are higher risk than others
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Each of the following would be able to deduct the premiums from a life policy from taxes except
- When the premiums are paid from a company bonus.
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All the following characteristics of group life policies are correct except
- Underwriting is based on the groups age and average health condition.
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Which of the following statements is correct?
- Annuities do not pass tax-exempt however life insurance does.
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What qualified retirement plan is a defined contribution plan with pre tax contributions that uses annuities and mutual funds only for investment options?
- 403B
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A defined contribution plan is a qualified retirement plan in which:
- contributions are defined, but the ultimate benefit to be paid is not.
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When would life insurance proceeds be subject to federal or state income taxes?
- When the policy is transferred for money.
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Which of the following is not a requirement for eligibility in an employer plan?
- Employees must be 18 years of age or older.
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Laura has paid a total of $3,600 into her annuity. The cash value in her account is currently $4,200. If Laura rolls the entire value of her annuity into a different
- annuity under a Section 1035 exchange, she must pay income tax on
- - $0
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All of the following are valid reasons that could support the recommendation to purchase a deferred annuity EXCEPT
- stepped-up basis to the beneficiary at the owner's death
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The incorrect statement pertaining to TSAs would be
- TSAs are available to employees of certain nonprofit organizations and schools, such as a nursing student.
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All the following statements about group life insurance policies are false except:
- The employer is the master policy holder.
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This provision allows you to exchange an existing insurance or annuity contract for a newer contract without having to pay taxes on the accumulation in your
- old contract
- - 1035 exchange
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Which of the following would generate a taxable situation?
- The policyowner surrenders the policy and receives $15,000 in cash value in which they paid $12,000 in premiums.
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Which of the following statement about profit sharing plans is incorrect?
- Yearly earnings are fully taxable in the year received.
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Of the following correct statements concerning the conversion privilege of group term life insurance which is not correct?
- There is no coverage during the conversion period if the employee/insured has decided not to exercise their right to convert.
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All of the following would be income tax free except
- Cash surrender amount is in excess of the premiums paid.
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All the following characteristics of group life policies are correct except:
- Underwriting is based on the groups age and average health condition.
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Sometimes a substandard risk is also called
- Rated
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__________guarantees that when a contract is annuitized, the income payments will be based on the greater of the actual contract value or a minimum payout base.
- Guaranteed Minimum Income Benefits
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Higher retention rates are advantages for all parties involved in life insurance because:
- Lower expenses and lower product prices.
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One of the underwriter's duties is classification of the risk. Which of the following would be incorrect concerning classification?
- A preferred risk is reflected in the mortality table.
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The purpose for this rider is to provide money for the insured to pay for medical and nursing care expenses if diagnosed with terminal illness.
- Accelerated Benefits
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All the following are true concerning MIB except:
- MIB gets its information from claim forms and physicians.
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What are the two methods most often used to compare the cost of life insurance policies?
- Interest Adjusted Cost Method and Traditional Net Cost.
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Which of the following statements about the MIB is not true?
- Insurance companies may use MIB reports to decline a policy.
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Morbidity tables are used by insurance companies to calculate:
- The likelihood of sickness.
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All the following are disadvantages of the Traditional Net Cost Method except:
- The dividends and premium payments are projections.
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All of the following are true regarding surplus except:
- Shareholder surplus is 50% of the capital.
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All of the following statements pertaining to life insurance premiums are correct except
- In establishing premium rates, a company must assume it will earn a high rate of interest on its invested premiums
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In the event of a loss, the insured is required to submit all of the following except:
- Acompleted Statement of the acting doctor.
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The State of California's required financial report includes all the following information except:
- The company’s declined policy results.
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All the following companies rate insurance companies financial strength except:
- Investor Service
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Which of the following is a true statement?
- Critical Illness riders pay benefits upon first diagnosis of a covered condition, and doesn't need to result in death.
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Money returned to policyholders from an insurance company’s earnings Is called:
- Policy dividends.
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Which rating would be considered best of the following choices?
- Moody Baal
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Usually companies offer several options when a policy is rated. Below are all true except:
- Charge for a lower age than the actual age
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Which consumer publication must be given to the insured that describes the type of coverage that is being offered?
- Buyers guide
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Which of the following is true concerning AIDS testing and underwriting?
- A policy may not contain exclusions for AID/HIV losses.
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Which of the following is a significant difference between individual policies and Group Life Insurance contracts?
- - Group underwriting is based on averages, such as the average age, the average working conditions and the average health condition of
- the group members
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An accelerated death benefit rider (also known as living needs rider) in a life insurance policy allows which of the following?
- The policyowner may receive a portion of the proceeds prior to the death under certain circumstances.
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Which rider would allow the insured to buy additional coverage at special times without a medical exam?
- Guaranteed insurability
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Jason has been disabled for 5 years and his policy had a waiver of premium rider. Which of the following is true?
- The premiums that were paid would have no effect on the either the cash value or the death benefit.
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The incorrect statement concerning the cost of living rider would be
- There is usually a premium increase for the additional protection if the insured can prove insurability.
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Jackson is paying $100 per month for his universal life policy which has a waiver of monthly deduction. Jackson was disabled 5 years.
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Which of the following is true?
- Jackson's mortality and expense charges would be paid however no money will be paid into the cash account.
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How do the level term rider on a Family Maintenance Policy and the decreasing term rider on a Family Income policy differ from all other level and decreasing term riders in that:
- These riders are used to produce income instead of a death benefit.
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_________is the amount by which an insurance company's assets exceed its liabilities and capital.
- Earned surplus
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All the following statements are true regarding a disability income rider except:
- The monthly income is based on a % of the death benefit of the policy to which it
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Vision care insurance is generally needed to cover all of the following EXCEPT
- injury to the eye
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Which type of major medical expense policy would use a corridor deductible?
- Supplemental Major Medical
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All of the following apply to vision policy except:
- Injury or disease of the eye.
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The Grace Period provision provides all of the following except:
- 30 days for a policy with a quarterly premium mode
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Each of the following terms is an important characteristic of a major medical policy except:
- Capitation
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With managed care, the member's choice of providers is most restricted in which of the following?
- HMO plans
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Which of the following qualifies as health insurance according to the code?
- None qualify as health insurance
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The type of healthcare provider that provides both healthcare services and healthcare coverage is"
- Health Maintenance Organization
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Which of the following groups contract with PPOs?
Employers Insurance companies
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Health insurance benefit providers, unions, and trusts.
All of the above.ojo
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According to ACA which of the following is required to be included as a benefit:
- Pediatric dental and vision is mandatory
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Basic medical expense policies do not have all of the following except:
- First dollar payout
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Which of the following might cause premiums and rates to be higher?
- Chronic conditions.
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Which of the following would be an example of health plan administrators?
- All of the above.
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When a claimant is covered by more than one plan, the conflict is resolved through:
- Coordination of benefits
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Which of the following would not be considered one of the basic types of managed care plans normally offered?
- EPO
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