FLORIDA 2-15 INSURANCE EXAM TESTBANK 200

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FLORIDA 2-15 INSURANCE EXAM TESTBANK 200

QUESTIONS AND ANSWERS 2024-2025 ALREADY

GRADED A

Mrs. Williamson purchases a 5-year, $50,000 term policy with an option to renew. Which of the following statements about the policy's renewability is CORRECT?

• The premium for the renewal period will be the same as the initial period.

• The premium for the renewal period will be higher than the initial period.

• The premium for the renewal period will be the same as the initial period, but a one-time

service charge will be assessed upon renewal.

• The premium for the renewal period will be lower than the initial period.
• The premium for the renewal period will be higher than the initial period.

Premiums for the renewal period will be higher because of the insured's advanced age and, thus, increased risk.Joanna and her husband, Tom, have a $40,000, annuity that pays them $200 a month. Tom dies and Joanna continues receiving the $200 monthly check as long as she lives. When Joanna dies, the company ceases payment. This is an example of

• an installment refund annuity

• a joint and full survivor annuity 1 / 4

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• a life annuity

• a cash refund annuity
• a joint and full survivor annuity

The joint and full survivor option provides for payment of the annuity to two people. If either person dies, the same income payments continue to the survivor for life. When the surviving annuitant dies, no further payments are made to anyone.Each of the following statements about the incontestable clause in a life insurance policy is correct EXCEPT

• the clause gives people assurance that when their policies become claims, they will be paid

without delays or protests

• the incontestable clause means that after a certain period, an insurer cannot refuse to pay

the proceeds of a policy or void the contract

• incontestable clauses usually become effective two years from the issue date of the policy

• insurers can void a contract even after the specified period provided they can prove the

policy was purchased fraudulently

• insurers can void a contract even after the specified period provided they can prove the

policy was purchased fraudulently

After the policy has been in force for the specified period, the company cannot contest a death 2 / 4

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3 claim or refuse payment of the proceeds even on the basis of a material misstatement, concealment, or fraud.All of the following statements correctly describe the purpose of Social Security EXCEPT

• to provide basic protection against financial problems accompanying death, disability, and

retirement

• to augment a sound personal insurance plan

• to provide a source of income for a meaningful standard of living

• to protect workers, their spouses, and dependent children
• to provide a source of income for a meaningful standard of living

The purpose of the Social Security system is to provide a basic floor of protection to augment-- not replace--a sound personal insurance plan. Many expect Social Security to fulfill all their financial needs and to provide a meaningful standard of living. The consequences of this misunder-standing have been disillusionment by many Americans who found they were inadequately covered when they needed life insurance, disability income, or retirement income.Ralph owns a $50,000 nonpar whole life policy. Its cash value has accumulated to $15,000, and he has paid a total of $9,500 in premiums. If he surrenders the policy for its cash value, how will it be taxed?

• Ralph will receive the $15,000 tax free.
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• Ralph will receive $5,500 tax free; the $9,500 balance is taxable as income.

• Ralph will receive $9,500 tax free; the $5,500 balance is taxable as income.

• Ralph will receive the $15,000 as taxable income.
• Ralph will receive $9,500 tax free; the $5,500 balance is taxable as income.

A policyowner is allowed to receive tax free an amount equal to what the policyowner paid into the policy over the years in the form of premiums.Which of the following would NOT apply when a life insurance policy is reinstated after a lapse?

• All back premiums must be paid.

• All outstanding loans must be paid.

• A new contestable period goes into effect.

• A new suicide exclusion period goes into effect.
• A new suicide exclusion period goes into effect.

There is no new suicide exclusion period when a policy is reinstated.Jane, age 35, has just purchased a 20-pay whole life policy. When she turns 55, she will

• receive the policy's face amount benefit

• have a fully matured policy
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