Traditional Mock Exam.docx

 TRADITIONAL  TRADITIONAL INSURANCE INSURANCE MOCK EXAMS SET A 1.) The life insurance indusr! is under "#$ern%en su&er$isi#n 'ecause D. I a(ecs &u'lic ineres .) All #f he f#ll#*in" are c#rrec sae%ens e+ce& D. There is a hi"her ris, ele%en f#r he insurance c#%&an! in$#l$ed in c#nneci#n *ih end#*%en &#licies han *ih *h#le life &#licies -.) The "uaraneed cash $alue is A. The a%#un ha he c#%&an! *ill &a! if he &#lic! is surrendered .) Aniseleci#n refers # "eneral endenc! #n he &ar #f  /. 0ers#ns *ih i%&aired insura'ili! # 'e %#re ,een in #'ainin" insurance c#$era"es han h#se &ers#ns *h# are in "##d healh .) Su'sandard &re%iu% raes are char"ed D. A&&licans *h# carr! a hi"her healh #r #ccu&ai#nal ris, 2.) 3#r an!#ne # ha$e he 'ene4 #f c#%&ensai#n #n he $alue #f he life #f s#%e#ne else5 here %us 'e an esa'lished D. Insura'le ineres 6.) The &re%iu% #n a &arici&ai#n life insurance &#lic! is D. 7i"her han a n#n8&arici&ain" n#n8&arici&ain" &#lic! 9.) In a child insurance &#lic!5 he 0aren :ai$er Clause &r#$ides ha; /. The &re%iu%s are *ai$ed if he faher is disa'led #r dies <.) The er% =>uali! /usiness? refers # h#se &#licies *hich C. Are &ersisen and de%#nsrae "##d %#rali! e+&erience 1@.) All #f he f#ll#*in" sae%ens re"ardin" =A's#lue Assi"n%en? are rue5 e+ce& C. The insurer %us a"ree # an a's#lue assi"n%en 11.) A li%ied &a! life &#lic! &r#$ides A. A &r#eci#n f#r he life #f he &#lic!h#lder *ih &re%iu%s &a!a'le f#r a li%ied er% #f !ears 1.) In %ee lie insurance a&&licai#ns5 he lar"es a%#un #f inf#r%ai#n reuesed is daa *hich D. Relaes # he insura'ili! #f he a&&lican 1-.) :hich #f he f#ll#*in" is he leas i%&#ran reas#n f#r reuirin" ha insurance a"ens 'e licensedB A. T# &r#$ide addii#nal inc#%e # he "#$ern%en hr#u"h license fees 1.) A c#%&an! ca% resric is lia'ili! if deah #ccurs as a resul #f an a$iai#n acciden. The a$iai#n e+clusi#n clause usuall! a&&lies # *hich #f he f#ll#*in"B /. Onl! f#r &il#s 1.) r#u& life insurance c#$ers /. Deah #f he e%&l#!ee re"ardless #f cause e+ce& suicide durin" he 4rs !ear s#%ei%e *# !ears) 12.) If he ineres #n a &#lic! l#an is n# &aid a he &#lic! anni$ersar!5 he insurance c#%&an! %a! D. Increase he &resen l#an '! he ineres 16.) #ur clien ells !#u ha *hen his faher died5 he recei$ed 0 @@5@@@ free #f Esae Ta+ and he had e$en ,n#*n ha his &#lic! e+ised. :hich #f he f#ll#*in" classi4cai#ns did !#ur clien fall underB D. Irre$#ca'le &ri%ar! 'ene4ciar!

19.) Mr. S! *al,ed #u #f his h#use #ne ni"h and *as ne$er hear #f a"ain. 7is *ife *aned # %a,e a clai% #n his life insurance &#lic!5 as she 'elie$es ha he is dead. :hich #f he f#ll#*in" sae%ens is c#rrec in his caseB /. I *#uld 'e se$en !ears 'ef#re he c#ur c#uld declare hi% le"all! dead 1<.) In life insurance5 he er% =su'sandard raes? "enerall! is used # refer # /. 0re%iu%s char"ed # &ers#ns *h# are c#nsidered # 'e hi"her8han8a$era"e ris, cae"#ries @.) Life insurance &#lic! l#ans are li%ied # an a%#un *hich *ih ineres *ill n# e+ceed he A. Cash $alue #f he &#lic! 1.) A %an %ade his *ife his irre$#ca'le 'ene4ciar! and if she died 'ef#re hi% hen his children *ere each na%ed as irre$#ca'le 'ene4ciaries5 *hich #f he f#ll#*in" 'es descri'es he classi4cai#n #f he childrenB /. Irre$#ca'le sec#ndar! 'ene4ciar! .) In he 0hili&&ines5 an insurance c#%&an!Fs ri"h # rescind a life insurance c#nrac is "ener#si! li%ied # he 4rs  !ears f#ll#*in" &#lic! issue dae #r dae #f a&&r#$al #f las reinsae%en. The &r#$isi#n is e%'#died in A. Inc#nesa'ili! clause -.) All #f he f#ll#*in" are rue e+ce&; D. There are n# au#%aic n#n8f#rfeiure &r#$isi#n in life insurance &#licies .) The funda%enal ad$ana"e #f he use #f life insurance as a %eans #f %eein" ec#n#%ic l#sses is ha hr#u"h life insurance hese l#sses are D. S&read #$er a lar"e nu%'er #f &e#&le .) :hich #f he f#ll#*in" is falseB D. The G#' #f an a"en is # sueeHe as %uch %#ne! as &#ssi'le #u #f %a,in" a ne* sale 2.) If a &#lic!h#lder elecs # a,e he E+ended Ter% Insurance #&i#n #n a @ !ear end#*%en &#lic! *here he cash $alue is %#re ha sucien # &r#$ide he er% c#$era"e # %auri!5 in *hich #f he f#ll#*in" *a!s *#uld he e+cess fun 'e usedB A. T# &r#$ide a &ure end#*%en &#lic! a %auri! 6.) One reuire%ens a &#lic!#*ner %us %ee in #rder # reinsae a life insurance &#lic! is # A. 3urnish e$idence #f insura'ili! *hich is saisfac#r! # he insurance c#%&an! 9.) If a &#lic!h#lder chan"es his #ccu&ai#n *ih#u n#if!in" he c#%&an!5 %i"h i a(ec he 'ene4s under his &#lic!B C. N#5 'ene4s a"reed u&#n a he ince&i#n #f he &#lic! %a! n# 'e chan"ed. <.) :hich #f he f#ll#*in" sae%ens is falseB C. :hen a &#lic! la&ses5 he c#%&an! neiher "ains n# l#ses since i ceases # carr! ris, #f c#$erin" he insured -@.) A faher has his &resen life insurance &a!a'le # his esae and 'ecause he has n#* reired he *ans # &ass he &#lic! #n # his s#n *h# *ill assu%e he &re%iu% &a!%ens. :hich #f he f#ll#*in" *ill he ha$e # a&&#in his s#n # achie$e his desire and &r#ec he s#n fr#% Esae Ta+B D. A's#lue assi"nee -1.) A 'usiness%an has arran"ed f#r a de$el#&%en l#an5 *hich *ill 'e a$aila'le 1 !ear fr#% n#*. /ecause he is una'le # *ai unil hen he has arran"ed an ineri% l#an *ih his 'an,. The #nl! &r#'le% is ha he 'an, *ans l#an secured a"ains he ris, #f deah. :ha is he 'es ec#n#%ic arran"e%en ha !#u can rec#%%endB D. earl! rene*a'le er%

-.) A &r#s&ec ells !#u ha he *ans # 'e insured a a"e 2 'u he d#es n# *an # &a! %#re han he %ini%u% &#ssi'le le$el #f &re%iu%s. :#uld !#u #(er hi% /. Ter% &#lic! --.) An a&&lican *ans # "e a &arici&ain" &#lic!5 *hich *ill ha$e he %a+i%u% cash a$aila'le f#r e%er"encies. :hich #f he f#ll#*in" sh#uld he selecB A. Accu%ulaed di$idends -.) :hich #f he f#ll#*in" is n# c#rrec *ih res&ec # reinsae%en &r#cessB /. :rien assurance #f inen # ,ee& he &#lic! in f#rce -.) If he &ers#n *h#se life is insured dies durin" he "race &eri#d and he &re%iu% as n# &aid5 he a%#un ha he insurance c#%&an! *ill &a! # he 'ene4ciar! is usuall! he D. 3ace a%#un #f he &#lic! %inus he un&aid &re%iu% -2.) :hich #f he f#ll#*in" sae%ens is falseB D. /ecause #f is $er! sh#r durai#n5 he case $alue #f a !earl! rene*a'le er% &#lic! "r#*s $er! fas -6.) The insurance C#%%issi#ner has he &#*er # re$#,e #r refuse # rene* an a"enFs license in all #f he f#ll#*in" insances e+ce&; /. :hen an a"en %a,es an! %aerial %isre&resenai#n -9.) A &ers#nFs hu%an ec#n#%ic $alue is de4ned as he D. T#al $alue #f he asses and an! fuure earnin"s deri$ed here fr#% -<.) The 'asic &ur&#ses #f a c#ndii#nal &re%iu% recei& are # ac,n#*led"e &a!%en #f he iniial &re%iu% f#r life insurance and # /. 0r#$ide insurance c#$era"e earlier han he &#lic! deli$er! dae if cerain reuire%ens are %e @.) A &ure end#*%en &#lic! A. 0a!s &r#ceeds # he insured #nl! if he li$es # he end #f he s&eci4ed &eri#d 1.) The c#nsiderai#n reuired '! he insurance c#%&an! # %a,e he insurance c#$era"e e(eci$e is he /. 0a!%en #f he iniial &re%iu% .) An a&&lican *ans a &arici&ain" &#lic! *here he deah 'ene4 *ill 'e %a+i%iHed. :hich #f he f#ll#*in" sh#uld he ch##seB A. 0aid8u& addii#ns -.) The 'ene4ciar!5 a *id#*5 *ishes # &a! #( he re%ainin" 'alance #f a 18!ear %#r"a"e. :hich #f he f#ll#*in" #&i#ns d# !#u rec#%%endB D. N#ne #f he a'#$e .) :hich sae%en is false *hen he ne* #*ner '#rr#*s #n a &#lic!B /. Di$idend *ill 'e reduced '! he a%#un #f he curren ineres .) A *h#le life &#lic! &r#$ides; D. 0r#eci#n *ih &re%iu%s &a!a'le f#r life and l#* le$el #f sa$in"s as an alernai$e # c#ninued &r#eci#n in #ld a"e 2.) In &racice5 %#s clai%s f#r deah 'ene4s #f life insurance &#licies are D. 0aid &r#%&l! as s##n as &r#&erl! c#%&leed clai% f#r%s are recei$ed '! he c#%&an! 6.) The f#ll#*in" sae%ens c#ncernin" insura'le ineres are c#rrec5 e+ce&; C. I is i%&#ran f#r &ur&#ses #f under*riin" he ris, 9.) The c#%&an! *ill all#* a &#lic! chan"e fr#% a hi"her # a l#*er &re%iu% &lan5 &r#$ided he insured C. 0resens saisfac#r! e$idence #f insura'ili!

<.) A &#lic!h#lder *ih a *h#le life &#lic! has reached he a"e #f 2 and he d#es n# *an # "# #n &a!in" &re%iu%s 'u he d#es *an # re%ain insured f#r life. :hich #f he f#ll#*in" *#uld he a,eB D. 0aid8u& insurance reduced a%#un) @.) Life insurance c#nri'ues direcl! # he *elfare and &r#"ress #f he c#unr! '! D. All #f he a'#$e 1.) 3#r *ai$er #f &re%iu% # 'e e(eci$e5 C. Disa'ili! %us 'e &er%anen .) In a life insurance c#%&an!5 ris, a&&raisal is necessar! # A. 0re$en an! ani8seleci#n -.) Li%ied &a!%en life &#licies are called such 'ecause h#se &#licies /. Li%i he &eri#d durin" *hich he &re%iu%s are &a!a'le .) :hich #f he f#ll#*in" is a sele%en #&i#nB D. Ineres #n insurance &r#ceeds .) :hich #f he f#ll#*in" sae%en is falseB D. A"ens *ih &ersisen 'usiness seld#% sa! l#n" *ih #ne c#%&an! 2.) Under and end#*%en &#lic!5 if he &ers#n *h#se life is insured sur$i$es # he end #f he &eri#d saed in he &#lic!5 he /. 3ace a%#un #f he &#lic! *ill 'e &aid 6.) =Criical !ears? in &r#"ra%%in" #f life insurance %eans D. 0eri#d durin" *hich he children are s%all and cann# &r#$ide f#r he%sel$es 9.) enerall!5 a reinsae%en a&&licai#n *ill 'e acce&ed fr#% he #*ner #f a la&sed insurance &#lic! /. :ihin a &eri#d #f hree #r 4$e !ear afer he dae #f la&se as s&eci4ed in he &#lic! <.) The insurance C#%%issi#ner has he &#*er # re$#,e #r refuse # rene* an a"enFs license in all #f he f#ll#*in" insances e+ce&; C. :hen an a"en inJuences he a&&licanFs ch#ice #f &lan # 'e &urchased 2@.) In a case *here he &re%iu% has n# 'een &aid and he cash $alue has 'een e+haused5 he &#lic! can sill a$ail #f  /. Reinsae%en &r#$isi#n 21.) The inf#r%ai#n #n a life insurance a&&licai#n relain" # an a&&licanFs 'irhda!5 #ccu&ai#n and a$#cai#n is used '! he c#%&an! &ri%aril! f#r he &ur&#se #f; A. A&&raisin" Ris, 2.) A clien has &#lic! *ih !#u f#r 0 15@@@5@@@5 *hich is &a!a'le # his esae and he ells !#u ha he *ans his *ife # recei$e he %#ne! free fr#% Esae a+. #u rec#%%end ha he A. A&&#in an irre$#ca'le 'ene4ciar!

SET / 1.) #u $isi a &r#s&ec *h# ells !#u ha he d#es n# 'elie$e in life insurance 'ecause *hen his %#her died5 he *as 'ene4ciar! under he life &#lic! and %#s #f he %#ne! *en # &a! Esae a+es 'ecause her a"en %ade a %isa,e. Onl! his %an and his siser *ere na%ed in he &#lic!. :hich #f he f#ll#*in" did he! fall underB C. Re$#ca'le sec#ndar! 'ene4ciar!

.) The 'asic c#$era"e &r#$ided '! life insurance &#licies %a! 'e su&&le%ened '! se&arae &r#$isi#ns ha &r#$ide c#$era"e f#r addii#nal a%#uns #r #f a di(eren naure. C#lleci$el! hese &r#$isi#ns are ,n#*n as A. Riders