A bilateral contract is an agreement between two parties in which each side agrees to fulfill their side of the bargain. Risk Hazard Indemnity Peril, Insurance companies determine risk exposure by which of the following? Policyowner has the right to select the investment which will provide the greatest return. Producers act in a(n) ________ capacity when holding insurance premiums. His insurance agent told him the policy would be paid up if he reached age 100. After first premium is paid, the face amount may be available to the beneficiary, Level premium term life insurance policies, Have premiums that are averaged over the policy period, A policyowner can receive an immediate payment before the insured dies by using a(n), Matt is applying for life insurance and requests a double indemnity rider. Adjustable life insurance Decreasing term insurance Increasing term insurance Modified life insurance, A spouse and child can be added to the primary insured's coverage as what kind of rider? Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. C) A contract where one party "adheres" to the terms of the contract What does the word level in Level Term describe? the contract is voidable upon proof of fraud. A new stain removal product claims to completely remove the stains on 909090 percent of all stained garments. Waiver Exclusion Rider Provision, The double indemnity provision in a life insurance policy pertains to an insured's death caused by a(n) sickness suicide accident war, An insurer will accept a premium from the insured and continue the coverage in full force as though it was NOT late during which time period? A) Legal A. Required fields are marked *. B) NAIC C) Contract must have a legal purpose Which market index is normally associated with an indexed annuitys rate of return? B) Law of adhesion Joint life policy Survivorship life policy Dual life policy Multiple life policy, A life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called whole life group life credit life universal life, Can be converted to permanent coverage without evidence of insurability, Donald is the primary insured of a life insurance policy and adds a children's term rider. Anheuser-Busch InBev is trying to reduce its water usage. Which of the following BEST describes a conditional insurance contract? One-sided or unfair insurance contracts can, however, exist if they contain provisions that disproportionately benefit one party. It is not necessary for the parties to exchange unequal consideration in a conditional insurance contract. A) A contract that requires certain conditions or acts by the insured individual Term, whole, and universal life insurance. written contract d) an agreement requires a definite offer and an indefinite acceptance. Question and answer. b) a contract is an agreement enforceable at law. D) collateral, Express power given to an agent in an agency agreement is Which of the following are the premium payments for a universal life policy NOT used for? Dual Life insurance Joint Life insurance Last Survivor Life insurance Shared Life insurance, Index whole life insurance contains a securities component that acts as a(n) hedge against inflation premium stabilizer means to lowering taxes on earnings incentive to purchase more coverage, Which of the following are the premium payments for a Universal life policy NOT used for? What is a corridor in relation to a Universal Life insurance policy? C) consideration Which type of multiple protection policy pays on the death of the last person? Events are those which cannot be controlled by either . Which of the following would be considered an underwriting duty of an agent? A) producer's apparent authority Barry offers Chris his mountain cabin for the weekend to secure his order for his insurance business. A) there is an element of chance and potential for unequal exchange of value or consideration for both parties Connect the text to your own experiences. Incontestable period Probation period Reinstatement period Grace period, The benefit can be offered as a rider at a specific extra cost or may be at no cost, Which of these is NOT a characteristic of the Accelerated Death Benefit option? A) One party is restored to the same financial position the party was in before the loss occurred B) The unequal exchange of value or consideration for both parties C) One party (the insurance company) prepares the contract with no negotiation between the applicant and insurer D) Only one party (the insurer) makes any kind of enforceable promise Which of the following best describes a symbol. The provision that allows this is called Partial Surrender Subrogation Automatic Premium Loan Accelerated Death Benefit, All of these are characteristics of a universal life insurance policy EXCEPT Flexible death benefit Fixed surrender value Flexible premiums Builds cash value, Which of the following policies does NOT build cash value? ______ is NOT an element of a valid contract. What is the difference between insurance condition and warranty? C) the authority to represent the insurer B. Legal The type of annuity she is seeking is called. Write a summary of the main ideas. During periods of inflation, annuitants will experience a decrease in purchasing power of their payments. Conditional insurance contracts are insurance policies that require the insured person to satisfy certain conditions in order to become effective and/or to be paid out by the insurer. Use the binomial distribution to find P(x13)P(x \leq 13)P(x13) if the stain removal product's claim is correct. State Insurance Departments NAIC Insurance carriers Insurance producers, Intentional withholding of material facts that would affect an insurance policy's validity is called a(n) estoppel concealment adhesion misrepresentation, The power given to an individual producer that is not specifically addressed in his/her contract is considered what type of authority? At what point may a producer sell insurance for an insurer? A) Sister and brother D) Only the insured is legally bound, Bob and Tom start a business. Both partners are still married at the time of Bob's death. d. a deductible stated in the policy's provision. C) Authority given to handle claims and process payments The present cash value of the policy equals $250,000. Corporations, like all firms, can raise money by borrowing from banks and other lending institutions. C) The insured and the insurer contribute equally to the contract. Only the insurance company has legal obligations. Active Status Results Leave, A provision that allows a policyowner to temporarily give up ownership rights to secure a loan is called a(n) automatic premium loan nonforfeiture option collateral assignment irrevocable assignment, Period of time after the premium is due but the policy remains in force, What is an insurance policy's grace period? D) misrepresentation, Which of the following is NOT required in the content of a policy? In a life or health insurance contract, "consideration" would be the, statements made in the application and the premium, A professional liability for which producers can be sued for mistakes of putting a policy into effect is called. How soon can the benefit payments begin with a deferred annuity? Intent, The deeds and actions of a producer indicate what kind of authority? The present cash value of the policy equals $250,000. An insurer's claim settlement practices are regulated by the Securities and Exchange Commission (SEC) National Association of Claims Adjusters (NACA) National Association of Insurance Commissioners (NAIC) State insurance departments, A life insurance company has transferred some of its risk to another insurer. C) Charge more premium Options A) A contract that requires certain conditions or acts by the insured individual B) A contract that has the potential for the unequal exchange of consideration for both parties C) A contract where one party "adheres" to the terms of the contract Which statement is CORRECT when describing a contract of adhesion? Expert answered|Malekith22|Points 0| Log in for more information. How many days is a temporary producers license valid? B) A contract that has the potential for the unequal exchange of consideration for both parties Which of the following BEST describes a conditional insurance contract? A contract that requires certain conditions or acts by the insured individual. Period of time after the initial premium is paid and before the policy is issued Period of time it takes for a policy's underwriting to complete Period of time after a policy is issued and before it is delivered to policyowner Period of time after the premium is due but the policy remains in force, Life insurance policies will normally pay for losses arising from commercial aviation war suicide hazardous jobs, A policyowner may exercise which of these dividend options that uses the dividend to pay all or part of the next premium due? In this situation, who will receive Bob's policy proceeds? D) Legal Purpose, Which of the following is present when an applicant stands to lose value if the insured dies? b. benefits paid under workers compensation. Adjustable life policy Modified life policy Endowment policy Universal life policy, How are survivorship life insurance policies helpful in estate planning? contain an offer and acceptance, In an insurance contract, the insurer is the only party legally obligated to perform. warranty guarantee representation collateral, there must be legal reasons for entering into the contract, Legal purpose is a term used in contract law meaning there must be an offer and acceptance the contract must be aleatory there must be legal reasons for entering into the contract the contract must be a contract of adhesion, In an insurance contract, the element that shows each party is giving something of value is called offer acceptance consideration purpose, What makes an insurance policy a unilateral contract? Interest on policy loans is tax deductible Premium payments are tax deductible Pre-death distributions will become taxable Cash value cannot be surrendered early, seeks temporary protection and lower premiums, Term insurance is appropriate for someone who seeks living benefits for themselves seeks a policy that builds cash value seeks temporary protection and lower premiums seeks permanent protection and higher premiums, Shirley has a $500,000 10-year non-renewable level term life policy. express, ______ is NOT an element of a valid contract. Premium clause Consideration clause Adhesion clause Contestability clause, When the principal gives the agent authority in writing, it's referred to as express authority implied authority apparent authority imposed authority, Ambiguities in an insurance policy are always resolved in favor of the insured producer insurer underwriter, ______ is NOT an element of a valid contract. Ken is a producer who has obtained Consumer Informations Reports under false pretenses. insured A) A contract that requires certain conditions or acts by the insured individual This is also known as a non-negotiable insurance contract, or an automatic contract. What kind of policy is this? Term insurance is appropriate for someone who, Seeks temporary protection and lower premiums. Which of these statements is true? The insured, on the other hand, makes few, if any, legally binding promises to the insurer. How often must the Commissioner examine each domestic insurance company? The period of coverage The face amount The premium payments The cash value, at a predetermined date or age, regardless of the insured's health, A Renewable Term Life insurance policy can be renewed at a predetermined date or age, regardless of the insured's health only if the insured provides evidence of insurability anytime at the policyowner's request typically with no change in premium, Pre-death distributions will become taxable, Under a Modified Endowment Contract, what are the likely tax consequences? What is created after policy proceeds are obtained in a lump sum and then immediately invested? Your email address will not be published. _______ is the authority given to a producer to transact business on behalf of the insurer. When initial premium is collected and policy is issued. $2,406 conditions, Legal purpose is a term used in contract law meaning Who assumes the investment risk with a fixed annuity contract? Her son, Mike, is the beneficiary. A unilateral contract is one in which only one party makes a legally binding guarantee. C) statements made in the application and the premium Orissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Offering payment of approved claims within 30 days after affirming liability. In most insurance policies, the insurer is the only one who makes a legally binding promise to pay insured claims. A Dalhousie University student training for distance running finds that, after running for x hours, her distance traveled, in kilometers, is given by, y=f(x)={10xif0x35x+15if3
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