Kennedy has paid $400,000 in annuity payments. She annuitized her annuity five years ago with the “cash refund” option and has received $60,000 in payments from the insurance company.

If Kennedy were to die today how much would the insurance company pay her beneficiaries?

The Joint and Full Survivor option pays the most of any survivor option as the surviving annuitant receives ____% of the payment.

Which statement(s), if any, are correct regarding insurance and annuities?

Statement I: The creation of an estate at the death of “the customer” is a characteristic of Life Insurance.

Statement II: The liquidation of a principal sum over the life of “the customer” is a characteristic of Annuities.

When annuitization begins no further payments can be made into the annuity and the ___________ period ends.

Peggy Sue has accumulated thirty-two credits in the Social Security’s system for determining eligibility for benefits.

Is she eligible for full retirement and survivor benefits?

What percentage of a workers earned income (wages) are taxed for FICA?

All OASDI benefits are calculated from the worker’s:

Social Security defines a disability as one in which the worker is unable to engage in:

The Social Security system provides a basic floor of protection to all working Americans against the financial problems brought on by:

Which, if any, of the following statements regarding Social Security are correct?

Statement I. The Social Security system uses an accrued “credit” system to determine eligibility for benefits.

Statement II. The maximum accrued credits are 12 credits per year (one per month).

Sharon Trout works for Lucky Charms Diet Clubs of America (LCDCA) as an account executive. LCDCA has a qualified 100% employer funded retirement plan.

When are the earnings in the plan taxed to Sharon Trout?

True or False? ERISA’s purpose is to protect the rights of employers with employer-sponsored plans.

Lucky Charms Diet Clubs of America (LCDCA) has a qualified retirement plan with 100% vesting for employees with two or more years of service.

Which, if any, of the following employees are eligible to participate in Lucky Charms’ retirement plan.

Walter E. Chimp has been contributing $100 per paycheck into his company sponsored defined contribution plan.

What percentage of Mr. Chimp’s contributions are vested?

Which of the following organizations would qualify for a 403(b) retirement plan?

If the Lucky Charms retirement plan is a Profit-Sharing Plan, LCDCA will be required to make:

If eight owners of a “close corporation” choose a close corporation cross-purchase buy-sell plan and the company is valued at $6,000,000 how much life insurance will each owner have to purchase on the lives of each other owner?

Michele, a mother of two, is fifty-two years old and plans on working until she is sixty-five. Her current income is $48,000 and she pays $7,000 in taxes and Janet absorbs $10,000 per year.

Michele’s “work-life” equals?

What interest rate should be used in computing Michele’s Human Life Value if the current inflation is at 2%, Federal Funds rate is 2.25%, the rate on a CD is 2.35%, and the rate on a 30 year fixed mortgage is 4.50%.

You are working with Kenny Ray to determine the appropriate amount of Life Insurance Mr. Ray should have. Which of the following should be included in calculating Kenny Ray’s “final expense fund”? (select all that apply)

Mr. Ricky Cotton of Coconut Grove, Florida has recently passed away. Ricky was the family breadwinner and is survived by his thirty-four year old wife, Sheila, and twelve year old daughter, Cherri.

How many years will Cherri be eligible to receive survivor’s dependent’s benefits?

The __________________________ provision allows an insured suffering from a terminal illness to receive “living benefits” while they are alive so they and their families can continue in their lifestyle, maintain their residency, or pay for the insured’s medical expenses.

Which of the following are correct regarding “fraternal benefit societies”? (select all that apply)

Social insurance programs are government programs that are funded with taxpayer dollars and serve national and state purposes. Government programs include all but which of the following?

Dr. Jackie Vizon is an optometrist. Which of the following risk retention groups might Dr. Vizon be insured by?

___________________ Organizations focus on preventive care and treatment.

The two main purposes of industry oversight are to ensure:

Which Federal Act re-established the states as the regulators of insurance?

Which association handles claims of insolvent life, accident, and health insurance companies?

Cameron gave Kenisha Kent a $25 gift certificate to Kenisha’s favorite restaurant as part of his schomoozing to sell her company, All Kinds of Kupcakes, Inc., a pension plan. Is Cameron guilty of unfair practice?

___ years of record retention are required by the department.

Which of the following are the duties and powers of the department regarding FLAHIGA and the liquidation of insurance companies?

Slade Markham is in a “one-man-band” where he is the owner, agent, and service department for his one personal health insurance agency, The Slade Markham Agency. Is Mr. Markham required to have an agency license?

Any person or entity that transacts insurance without a certificate of authority is guilty of at least a __________ felony.

Marsha Marsha, a licensee, must notify the department, in writing, within __ days after a change of name, residence address, principal business street address, mailing address, contact telephone numbers, including a business telephone number, or email address.

Matthew Williams is replacing his current Life Insurance policy with Gallant Insurance with a new policy through Acme Insurance. Which form must Gallant Insurance provide Matthew with?

Dave has recommended to his client, Martin Short, the surrender of his life insurance policy which contains cash value. Dave must provide Martin all but which of of the following?

Jenna Jones is replacing her current life insurance policy with Acme Life Insurance with a new policy through Thrive Right Life Insurance Group. Thrive Right Life Insurance Group is required by law to send a copy of the Notice to the Applicant Regarding the Replacement of Life Insurance to the insured’s ___________?

Advertisements containing a rate to be earned are prohibited unless all limitations and conditions that affect the rate of return ultimately realized by the policyholder are _____________ prominently.

Sarah is replacing her client’s life insurance policy. To do so, what form must Sarah have her client sign?

True or False? The grace period for a life insurance policy is 30 days.

Insurance contracts are considered aleatory contracts because (choose all that apply):

Which, if any, of the following statements are correct?

Statement I. Valued Contracts pay a stipulated amount listed specifically in the policy.

Statement II. Indemnity Contracts pay the value of a loss subject to the policy limits.

James has convinced his neighbor, a senior citizen, to allow James to take out life insurance on the life of the neighbor with James named as the beneficiary. James has advised he will pay all of the premiums and James has offered the neighbor $2,500 for participating in the transaction. This is an example of:

True or False? To be enforceable at law a contract must have a legal purpose.

_______ Law governs the relationship between an agent and insurer and that being that an act by the agent is an act by the principal.

Which of the following are required for a contract to be legal?

Life insurance ___ a personal contract between insurer and insured.

Sharon is replacing Mrs. North’s insurance policy; all but which of the following are appropriate in the replacement?

When using illustrations, agents are required to obtain a signed statement from the proposed insured acknowledging that non-guaranteed elements are subject to changes either higher or lower and that they are not ___________.

Misrepresentation is any written or oral statements that do not accurately describe policy benefits or coverages AND misrepresentation is ________. Defamation is the false, malicious, or derogatory communication (oral or written) that injures another’s reputation or character AND defamation is ________.

Policy replacement includes which of the following?

True or False? The NAIC model regulations state that illustrations must not contain words like invisible premium.

____________ selling is presenting products that meet specific needs of clients so the client can make their own decisions about what products are best for them.

Unfair discrimination takes place in the sales or underwriting process when adverse decisions are made based on characteristics such as:

Which of the following, if any, are favorable tax treatments of life insurance policies? (select all that apply)

If the insured wants her Universal Life insurance policy to pay the face amount of her policy plus pay her the policy’s cash value which UL Death Benefit Option should she choose?

Straight whole life insurance is based on the age of issue to the actuarial age of ___.

A _______________ Policy gives the insured the option to renew the term policy without going through medical underwriting.

Roberto has a term insurance policy with a $250,000 face amount which decreases every year for 30 years; basically to cover the declining balance of his home mortgage.

What type of term insurance policy does Roberto have?

All of the following are factors contributing to the cash value in an insurance policy EXCEPT?

Which of the following is NOT a bar to contesting an insured’s claim after the expiration of the Incontestable Clause?

This standard life insurance provision provides for the early payment of some portion of the policy should the insured suffer from a terminal illness or injury.

Becky’s whole life policy has lapsed. Which non-forfeiture option will provide Becky with the same amount of coverage (albeit for a limited time)?

Shelby has received a dividend and elects to use the dividend to purchase more insurance. Which dividend options might Shelby elect?

Your insured customer would like to be protected if he becomes disabled and is unable to make his premium payments.

What policy rider will you add to his policy?

Which type of policy assignment would be most appropriate when using life insurance to secure a loan?

Which, if any, of the following statements are correct?

Statement I. Jim is the policyowner and Jill is a revocable beneficiary on the policy. Jim can change the beneficiary at any time.

Statement II. Jim is the policy owner and Jill is an irrevocable beneficiary on the policy. Jim cannot change the beneficiary without Jill’s written consent.

Which beneficiary designation passes down from a deceased primary beneficiary to the children of the beneficiary?

What is the purpose of the Spendthrift Trust Clause in a life insurance policy?

Michele owns a life insurance policy on Brenda; Brenda is Michele’s sister and business partner. Michele has designated herself as the beneficiary. Which type of application is this?

Which of the following scenarios are eligible (Facility-of-Payment provision) for a claims payment without a policy beneficiary designation? (select all that apply)

True or False? An insurable interest by the beneficiary in the life of the insured is required when the original application is written and the applicant is not the insured.

Which of the following, if any, are used to compute a basic life insurance premium? (select all that apply)

For a mortality table to be accurate, it must be based on two things: a large cross section of people and a large cross section of time.

The share of operating costs applied to the computation of a life insurance premium is referred to as _____________.

Glen Winningham, your insured, has asked what his yearly premium payment will be for a $200,000 Whole Life Policy. His mortality cost is $490, projected interest earnings are $120, and applicable expense costs are $110.

Which of the following are not applicable in the individual mortality of an insured?

The sum of the life insurance premiums paid by the policyowner is known as the policyowner’s ______________.

Part ___ of a Life Insurance Application asks about the insured’s hobbies, profession, and if the insured smokes?

Dr. Babs Henn Jane took out a Life Insurance policy on June 30th paying her agent for the full years. The policy was issued by the insurance company and sent to the company’s local agent September 1st for the agent to deliver the policy.

What is the Policy Effective Date?

Which, if any, of the following are examples of relationships that automatically carry an insurable interest?

The _______________ questionnaire is required of any applicant who spends a significant amount of time flying, such as an airline pilot.

The ______________________________________ places requirements on health care providers with regard to disclosing patients’ medical information.

True or False? If the Life Insurance policyowner is a firm or corporation, one or more partners or officers, other than the proposed named insured, must sign the application.