Illinois Life Producer General Exam | Questions with 100% Correct Answers | Verified | Latest Update
Question : Consumer reports requested by an underwriter
during the application process of a life insurance policy can be used to determine
Correct answer: probability of making timely premium
payments The purpose of these reports is to provide a picture of an applicant's general character and reputation, mode of living, finances, and any exposure to abnormal hazards.
Question : Which statement about a whole life policy is true
Correct answer: Cash value may be borrowed against
Question : When an individual is planning to protect his
family with life insurance, one Method of doing so is called the needs analysis. What exactly does needs analysis involve
Correct answer: Establishes the needs of the individual and
his dependents
Question : In an insurance contract, the insurer is the only
party who makes a legally enforceable promise. What kind of contract is this?
Correct answer: UnilateralInsurance contracts are unilateral.
This means that only one party (the insurer) makes any kind of enforceable promise.
Question : What actions can a policyowner take if an
application for a bank loan requires collateral
Correct answer: Assign policy ownership to the bank
Question : Which requirement must be met for an association
to be eligible for a group life plan?
Correct answer: Group was formed for a purpose other than
acquiring insuranceGroup life insurance can be formed just as long as they are formed for a reason other than to purchase insurance.
Question : Which of the following policies is characterized by
a flexible premium and death benefit and allows the policyowner control of the investment aspect of the plan
Correct answer: Variable Universal Life"universal" indicates
that the policy has a flexible or Adjustable premium. The "variable" nature of the product indicates that the cash value
is invested in the stock market (ex: mutual funds) which
permits for a contract owner to decide where the equity (ex:
cash value) is to be invested
Question : Y purchased $100,000 worth of permanent
protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?
Correct answer: A Whole Life Policy with an Other Insured
Rider
Question : At the age of 45, an individual withdraws $50,000
from his qualified profit-sharing plan and then deposits this amount into a personal savings account. This action would result in
Correct answer: Income tax and a 10% penalty assessed upon
funds withdrawn from the Qualified PlanThe IRS says that withdrawals of funds from a profit sharing plan may be subject to a 10% tax penalty in addition to income taxes if
they are made before the age of 59 1/2. This same early withdrawal penalty applies to funds taken out of 401k plans and traditional individual retirement accounts
Question : What type of annuity has a cash value that is based
upon the performance of it's underlying investment funds?
Correct answer: VariableA variable annuity's cash value will
depend on the results of its investment funds.
Question : Which of the following features of a group term
life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability
Correct answer: The conversion privilege allows an individual
to leave the group term plan and continue his or her insurance without providing evidence of insurability.
Question : When a policyowner cash surrenders a Universal
Life insurance policy in it's early years, this may be considered a red flag for a(n)