Arizona Life Insurance Exam Questions and Answers(Latest Update 2023) Verified Answers, Exams of Nursing

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a whole life policy that provides a choice of dividend options include the following statement about dividends they accrue at a guaranteed rate

they are deferred for one year they are not guaranteed they are guaranteed

after the first year - Correct Answers ✅they are not guaranteed

When there is a named beneficiary on a life insurance policy, the death benefits

1. are directed to a trustee if the insured has any outstanding debts
2. are paid directly to the insured`s creditors, with any remaining balance forwarded to the beneficiary
3. are paid directly to the beneficiary, minus any debt claims by the insured`s creditors
4. are paid directly to the beneficiary without interference from the insureds creditors - **Correct Answers** ✅are paid directly to the beneficiary without interference from the insureds creditors

What determines how much an annuitant is paid for a variable annuity

1. varies according to how many outstanding annuitant is paid for a variable annuity
2. payments fluctuate as annuitant gets older
3. the market value variations of the securities backing it
4. varies according to the insurers investments in its general account -

Correct Answers ✅the market value variations of the securities backing it

a terminated employee has how many days upon termination to convert group life insurance coverage to an individual policy

10 days

the policy provision that permits an employee to change from group life insurance to an individual policy is called

1 assignment provision

2 conversion provision

3 certificate provision

4 modification provision - Correct Answers ✅conversion provision

when the deferred annuity is surrendered, who must sign the authorization to do so

owner

annuitant and beneficiary

annuitant

all parties involved - Correct Answers ✅owner

Which of the following is NOT a valid contract exchange?

1. an annuity exchanged for a life insurance policy

2 an annuity exchanged for another annuity

3 a life insurance policy exchanged for another life insurance policy

4 a life insurance policy exchanged for another annuity - Correct Answers

✅an annuity exchanged for a life insurance policy

which of these statements regarding the extended term insurance nonforfeiture option in a life policy is accurate

face amount minus any outstanding loan balances - Correct Answers

✅total premiums paid plus the policy face amount

which of these is NOT considered the responsibility of a producer during the underwriting process

collecting additional medical information if needed

promptly sending the completed application to the insurance company

forwarding any material personal observations to the insurer

selecting the final approval date - Correct Answers ✅selecting the final approval date

which of the following is NOT guaranteed in a whole life policy

settlement options

nonforfeiture options

dividend scale

policy loan values - Correct Answers ✅dividend scale

all of these duties that a producer may be required to perform when delivering an insurance policy EXCEPT

acquire a statement of good health signature

gather the initial premium

review policy with applicant

trust administrations fees would reduce policy proceeds

trusts cannot be used if a minor is the beneficiary

trustee must be a bank or brokerage - Correct Answers ✅trust administrations fees would reduce policy proceeds

what does a fixed life annuity offer protection against

inflation

premature death

inadequate retirement planning

savings depletion due to longevity - Correct Answers ✅savings depletion due to longevity

a trustee-to-trustee transfer of rollover funds in a qualified plan allows a participant to avoid

mandatory income tax withholding on the amount transferred

paying transfer fees

paying trustee fees

ever paying income taxes on the distributions - Correct Answers

✅mandatory income tax withholding on the amount transferred

what happens when a policy owner borrows against the cash value of his life insurance policy

the policy proceeds would be reduced by the outstanding loan balance

which statement regarding the joint and survivor life insurance settlement options is NOT true

age of beneficiaries plays a factor when determining the payment amounts

income continues until the last beneficiary dies

two or more beneficiaries can be paid

the amount of each installment is larger than the single life income option - Correct Answers ✅the amount of each installment is larger than the single life income option

which statement regarding universal life insurance in correct

cash value accumulations have a guaranteed minimum interest rate

policy owner can change the face amount but not the premium

policy owner can change the premium but not the face amount

partial withdrawals cannot be made from the policy`s cash value - Correct

Answers ✅cash value accumulations have a guaranteed minimum interest rate

which of the following statements about universal life insurance in NOT true

death benefit can be increased

premiums are flexible

universal life insurance normally has a minimum guaranteed cash value for duration of the policy

a cash value loan is taken out

automatic premium loan provision is utilized

the policy is surrendered for less than what was paid into it

dividend is issued - Correct Answers ✅the policy is surrendered for less than what was paid into it

which statement regarding the life insurance premium for a childrens rider is true

decreasing premium as each child becomes an adult

premium remains the same no matter how many children

increasing premium as additional children are born

no premium is normally charged for a childrens rider - Correct Answers

✅premium remains the same no matter how many children

which of the life insurance policies does NOT contain a cash value provision

modified whole life

universal life

decreasing term life

adjustable life - Correct Answers ✅decreasing term life

what is the tax treatment of benefit payments for a non-qualified annuity

benefit payments are always fully taxable

benefit payments are subject to taxes only prior to age 70 1/

waive the premium payments in the event the insured becomes financially insolvent

relieve the insured of preimum payments following an initial waiting period after the insured becomes totally disabled

provide a policy loan to cover the premium payments in the event the insured becomes totally disabled

waive the premiums on this policy as well as any other insurance policy belonging to the insured i the event of total disability - Correct Answers ✅relieve the insured of premium payments following an initial waiting period after the insured becomes totally disabled

kevin has an existing life insurance policy and assigns it to another insurer for a new contract. how would this transaction be treated for tax purposes

as section 1035 exchange

as a transfer

as a rollover

as a section 1040 exchange - Correct Answers ✅as a section 1035 exchange

when would evidence of insurability be required for a person already covered with a variable universal life policy

when the premium is increased

when the policy has renewed

when the death benefit is increased

when policy is being converted to permanent coverage - Correct Answers

✅when the death benefit is increased