Primerica Life Insurance 2023/ 2024 Updated Exam | (Questions and Verified Answers with Rationales) 100% Correct
QUESTION
a producer agent must do
... [Show More] all of the following when delivering a new policy to the insured EXCEPT
A. Disclose commissions earned from the sale of the policy
B. Explain the policy provisions, riders, and exclusions
C. Collect any premium due
D. Explain the rating procedures if the policy is rated differently than applied for
Answer:
A. Disclose commissions earned fro the sale of the policy
A producer must explain policy provisions, exclusions, and riders at the time of the delivery, as well as the rating procedures especially if the policy is rated differently than applied for. The producer must also collect any due premium and have the insured sign the statement go continued good health
QUESTION
if an applicant for a life insurance policy and person to be insured by the policy are two different people, the underwriter would be concerned about
A. Which individual will pay the premium
B. Whether an insurable interest exists between the individuals
C. The gender of applicant
D. The type of policy requested
Answer:
B. Whether an insurable interest exists between the individuals
An insurable interest must exist at the time of the policy is issued. Some relationships are automatically presumed to qualify as an insurable interest. Ex: spouses, parents, children, and certain business relationships
QUESTION
When J. Applied for a life insurance policy, the agent informed him that a medical exam would be required. The exam may be completed by
A. A physician of the applicant's choice and at his expense
B. A home office underwriter
C. A paramedic or examining physician at the insurer's expense
D. The agent
Answer:
C. A paramedic or examining physician at the insurer's expense
The applicant may be allowed to select the physician or paramedic facility to perform the examination. The insurer pays the cost of such an examination
QUESTION
The factor added to the net premium to cover the costs of the insurer in obtaining and maintaining the business is called
A. Expenses
B. Legal reserve
C. Dividend accumulation
D. Premium tax
Answer:
A. Expenses
Loading is another term for expenses. Net premium (mortality minus interest earned) plus expenses (or loading) equal the gross premium
QUESTION
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?
A. Needs approach
B. Blackout approach
C. Lump-sum approach
D. Human life value approach
Answer:
D. Human life value approach
Human life value approach is determined by the loss of the income that would result with the death of the insured, after making adjustments for expenses, inflation, etc.
QUESTION
which of the following is NOT required for a producer to tell a prospect?
A. How the insurer would use any outside information regarding the applicant
B. An explanation of products that the insurer is selling
C. What requirements the producer needed to meet to obtain the insurance license
D. From what outside sources the insurer would seek information, regarding the insured
Answer:
C. What requirements the producer needed to meet to obtain the insurance license
Agents are required to inform prospects of the products they are selling, as well as their information collecting practices
QUESTION
which of the following statements concerning buy-sell agreements is true?
A. Premium paid are deductible as a business expense
B. Benefits received are considered income taxable
C. Buy-sell agreements pay in the event of a medical emergency
D. Buy-sell agreements are normally funded with a life insurance expectancy
Answer:
D. Buy-sell agreements are normally funded with life insurance expectancy
A buy-sell agreements is simply a contract that establishes what willl be done with a business in the event that an owner dies. Buy-sell agreements are normally funded with a life insurance policy
QUESTION
Who may complete a paramedical report?
A. An underwriter
B. A nursing assistant
C. A registered nurse
D. A spouse
Answer:
C. A registered nurse
Paramedical reports are completed by paramedics or registered nurses. Full medical expectations are reserved for those wanting higher coverage or for those who have more complex medical history
QUESTION
the term "illustrations" in a life insurance policy refers to
A. A presentation of non guaranteed elements of a policy
B. A depiction of policy benefits and guarantees
C. Pictures accompanying a policy
D. Charts and graphs
Answer:
A. A presentation of non guaranteed elements of a policy
The term "illustrations" means presentation of depiction that includes non guaranteed elements of a policy of individual of group life insurance over a period of years
QUESTION
which is generally true regarding insureds who have been classified as preferred risks?
A. They can borrow higher amounts off of their policies
B. They can decide when to pay their monthly premiums
C. They keep a higher percentage of any interest earned on their policies
D. Their premiums are lower
Answer:
D. Their premiums are lower
The preferred risk classification indicates that an insured is in excellent physical condition and employs healthy lifestyles and habits. These individuals qualify to lower premiums than those in other categories
QUESTION [Show Less]